RO 18.7m deposits in conventional banks

MUSCAT: Review of the activities of conventional banks indicates an annual growth in total outstanding credit of 3.9 per cent as at the end of June 2017, mainly due to credit to the private sector increasing by 5.5 per cent to RO 18.1 million.
Conventional banks’ overall investments in securities grew by 8.5 per cent to RO 2.8 million, with investment in Government Treasury Bills and foreign securities increasing by 24.4 per cent and 17.6 per cent, respectively at the end of June 2017.
Investment in Government Securities inclusive of GDBs, Government Sukuk, and others increased marginally by 0.7 per cent over the year to RO 1.3 million.
On the other hand, aggregate deposits held with conventional banks increased moderately by 2.7 per cent to RO 18.7 million in June 2017 from RO 18.2 million a year ago. Government deposits with conventional banks went up by 4.5 per cent to RO 5.0 million while deposits of public enterprises decreased marginally by 0.2 per cent to RO 1.1 million during the same period.
Private sector deposits, which accounted for 65.6 per cent of total deposits with conventional banks, increased by 2.4 per cent to RO 12.3 billion in June 2017 from RO 12.0 million a year ago.
The core capital and reserves of conventional banks as at the end of June 2017 stood at RO 4.1 million.
Islamic banking entities provided financing to the extent of RO 2.8 million as at the end of June 2017 as compared to RO 2.1 million a year ago.
Total deposits held with Islamic banks and windows also registered a significant increase to RO 2.7 million in June 2017 from RO 1.8 million as at the end of June 2016.
The total assets of Islamic banks and Windows combined, amounted to RO 3.6 million as at the end of June 2017, constituting about 11.6 per cent of the banking system assets.
With regard to monetary aggregates as at the end of June 2017, narrow money stock (M1) registered a year-on-year (YoY) increase of 1.3 per cent to RO 5.4 million. However, quasi-money (Rial Omani saving and time deposits, certificates of deposit issued by banks, margin deposits and foreign currency denominated deposits) witnessed a growth of 5.1 per cent during the period.
Broad money supply M2 (M1 plus quasi-money) stood at RO 16.1 million as at the end of June 2017 and grew by 3.8 per cent during the period.
In respect of domestic interest rate structure of conventional banks, the weighted average interest rate on RO deposits increased to 1.621 per cent
in June 2017 from 1.182 per cent a year ago while the weighted average RO lending rate increased to 5.123 per cent from 4.854 per cent during the same period.
The overnight Rial Omani domestic inter-bank lending rate stood at 0.978 per cent in June 2017, much higher as compared to 0.412 per cent a year ago. The average Repos rate for liquidity injection by the CBO stood at 1.638 per cent per annum during the month of June 2017. — ONA