Oman’s banking sector well-capitalised, liquid and resilient: CBO

Muscat: The banking sector remained well-capitalised, liquid, and resilient, supported by sound asset quality, prudent risk management practices, and limited exposure to external shocks, the Central Bank of Oman (CBO) said in its latest Annual Report for 2025.

Throughout the year, the CBO continued to ensure that the banking sector effectively served the needs of the real economy. The sector continued to play a pivotal role in supporting economic activity through effective financial intermediation, mobilising savings and channeling funds to productive sectors of the economy. Supported by sustained economic activity and strong public confidence, the sector continued to expand in 2025.

Total banking sector assets increased by 9.2 percent to reach OMR44.6 billion at end-December 2025. Total credit increased to OMR35.3 billion, showing a growth of 8.8 percent over 2024. Aggregate deposits of banks increased by 7 percent in 2025 to reach OMR34 billion by end-December. Credit to the private sector increased by 6.8 percent, reflecting continued financing demand across key sectors of the economy.

Profitability indicators continued to reflect healthy earnings performance, while asset quality remained stable, with the gross non-performing loans (NPLs) ratio contained at 4.4 percent as of December 2025.

Banks also maintained strong capital buffers, with the capital adequacy ratio reaching 18.8 percent, well above the regulatory minimum requirement of 13.5 percent. Liquidity conditions remained comfortable, supported by ample funding and compliance with prudential liquidity requirements.

CBO’s latest report reviewed the domestic economic environment, highlighting trends in real activity, inflation, fiscal and external positions, and the performance of the banking sector.

Oman’s macroeconomic environment remained supportive in 2025, with economic activity continuing to expand at a robust pace, despite external headwinds.

This provided the Government with the necessary policy space to advance structural reforms. Investment continued to be an important driver of growth, supported by continued progress in strategic projects across both the public and private sectors.

Inflation remained low, reflecting the credibility of the peg and stable domestic conditions. Fiscal and external balances recorded modest deficits, while public debt continued its declining path.