Oman economy grew 15.1pc in 1H 2018

Business Reporter -
Muscat, JAN 29 -
The Omani economy witnessed good progress and achieved an accelerated growth of 15.1 per cent during the first half of 2018 as compared to 10.3 per cent in the same period of 2017, the Central Bank of Oman (CBO) said.
The positive assessment came in the apex bank’s review of Banking of Monetary Developments for November 2018, issued here yesterday.
The hydrocarbon and non-hydrocarbon sector grew by 37.1 per cent and 5.1 per cent respectively, the report said. “The continuous policy efforts and improving business environment supported sustained expansion in non-oil economic activities. Inflationary conditions also remained benign and supportive of growth. Average annual inflation based on CPI for the Sultanate stood at 0.9 per cent during January- November 2018,” it stated.
Banking activities also gained further traction in line with pickup in overall economic activities. In the combined balance sheet of conventional and Islamic banks (other depository corporations), total outstanding credit stood at RO 25.1 billion as at the end of November 2018, recording a year-on-year(YoY) rise of 6.5 per cent. Credit to the private sector increased by 5.8 per cent to RO 22.2 billion as at the end of November 2018. Of the total credit to the private sector, the share of nonfinancial corporate sector stood at 46.4 per cent followed by the household sector (mainly under personal loans) stood at 45.2 per cent, financial corporations at 5.4 per cent and other sectors the remaining 3 per cent.
Total deposits of ODCs registered a growth of 5.8 per cent and stood at RO 22.8 billion as at the end of November 2018. Private sector deposits of the banking system increased by 3.9 per cent to RO 14.5 billion as at the end of November 2018.
Sector-wise, the share of households was 47.9 per cent of the total private sector deposit base, followed by non-financial corporations at 30.8 per cent, financial corporations at 18.8 per cent and the other sectors at 2.5 per cent.
Conventional banks exhibited an annual growth in total outstanding credit of 4.7 per cent as at the end of November 2018. Credit to the private sector increased by 3.8 per cent to reach RO 18.9 billion. Conventional banks’ overall investments in securities stood at RO 3.1 billion. Investment in Government Development Bonds and Government Sukuk increased by 13.2 per cent over the year to RO 1.4 billion, while their investment in Treasury Bills stood at RO 272.6 million. Conventional banks’ investments in foreign securities stood at RO 1.1 billion at the end of November 2018. Aggregate deposits held with conventional banks increased by 4.9 per cent to RO 19.5 billion in November 2018 from RO 18.6 billion a year ago.
Government deposits went up by 11.1 per cent to RO 5.4 billion, while deposits of public enterprises increased by 15.1 per cent to RO 1.1 billion. Private sector deposits which accounted for 65 per cent of total deposits with conventional banks, increased by 1.3 per cent to RO 12.7 billion in November 2018. The core capital and reserves of conventional banks stood at RO 4.5 billion as at the end of November 2018.
Islamic banking entities provided finance amounting to RO 3.5 billion as at the end of November 2018, higher as compared to RO 3 billion a year ago. Total deposits held with Islamic banks and windows also increased significantly by 11.2 per cent to RO 3.2 billion in November 2018. The total assets of Islamic banks and Windows combined, amounted to RO 4.3 billion as at the end of November 2018 and constituted about 13 per cent of the banking system assets.