CBO report affirms Oman’s stability and resilience

The Central Bank of Oman (CBO) has issued the 2025 Financial Stability Report, offering a comprehensive and forward-looking assessment of the financial system in the Sultanate of Oman. The report reflects the Bank’s commitment to transparency and accountability, going beyond merely identifying potential risks to highlight the resilience, adaptability and development capacity of the financial sector.
The report emphasises the strength of Oman’s financial foundations, the trust in its institutions and the country’s ability to prosper amidst both local and global changes. It confirms Oman’s steady progress towards long-term stability, sustainable growth and shared prosperity. Despite continued global uncertainty, Oman’s financial stability has remained largely firm, the report noted.
The Omani banking sector is in a strong position, supported by adequate capital reserves, high-quality assets and sufficient liquidity. Stress tests for financial solvency confirmed that the sector is capable of withstanding severe financial shocks, with all banks able to absorb potential liquidity pressures while maintaining liquidity coverage ratios above the regulatory minimum.
The banking sector has remained profitable, while non-banking financial institutions have continued to expand gradually, highlighting their growing role in delivering financial services.
The composite financial stability index showed positive trends, supported by factors such as higher oil prices, enhanced debt sustainability and improvements in systemic risk indicators.
The report highlighted increasing global confidence in Oman’s economic performance, reflected in the upgrade of Oman’s sovereign credit rating to investment grade by both Moody’s and Standard & Poor’s. This upgrade is largely attributed to prudent financial and economic management and improvements in public debt indicators.
The Systemic Risk Survey confirmed continued confidence in Oman’s financial system, while the Credit Conditions Survey showed overall stability in lending trends, despite slight easing in credit availability. These findings reinforce positive sentiment among stakeholders and continued trust in the sector’s stability.
The Central Bank conducted a survey to evaluate public financial awareness. Results showed relatively high levels of financial literacy, with respondents generally demonstrating cautious money management behaviours.
Key legal reforms included the new Banking Law, the revised Central Bank Law and updates to the Deposit Protection Law. These steps aim to strengthen the legal and supervisory framework in line with the evolving financial sector and ensure effective responses to modern financial system demands. The amended deposit protection law aims to support a more inclusive and flexible financial system, aligned with international standards.
The report reaffirmed the Central Bank of Oman’s continued commitment to strengthening the resilience of the national financial system through proactive monitoring, sound regulatory reforms and sustainable finance initiatives. The Bank will continue to safeguard financial stability and support sustainable economic growth by closely monitoring emerging risks and adjusting monetary policy tools as needed.
Since its first release in 2013, the Financial Stability Report has served as a key reference for stakeholders and professionals in the financial and economic sectors, providing in-depth analysis of potential vulnerabilities and outlining the strategic measures taken to address them. — ONA