Oman's Islamic banks register robust growth in finance at OMR1.85b

Muscat: Islamic banking entities provided financing to the extent of OMR1.85 billion by end-February 2016, compared to OMR1.1 billion a year ago.
Total deposits held with Islamic banks and windows also registered a significant increase to OMR1.59 billion in February 2016 from OMR0.7 billion outstanding as at the end of February 2015.
The total assets of Islamic banks and windows combined, amounted to OMR2.4 billion as at the end of February 2016 which constituted about 7.8 percent of the banking system assets.
The combined balance sheet of conventional and (Islamic banks other depository corporations taken together) provides a complete overview of the financial intermediation taking place in the banking system in Oman.
The total outstanding credit extended by the other depository corporations stood at OMR20.5 billion as at the end of February 2016, a rise of 12.4 per cent over the level witnessed a year ago.
Credit to the private sector increased by 14.9 per cent to OMR18.3 billion as at the end of February 2016. Of the total credit to the private sector, the share of the household sector (mainly personal loans) stood at 46.6 per cent, closely followed by the non-financial corporate sector at 45.3 per cent, financial corporations at 5.2 per cent and other sectors the remaining 2.9 per cent.
Total deposits also registered a significant growth of 6.3 per cent to OMR19.4 billion as at the end of February 2016. Private sector deposits of the banking system registered a growth of 7.6 per cent to OMR12.75 billion as at the end of February 2016.
Sector-wise, the share of households was 50.5 percent of the total private sector deposit base, followed by non-financial corporations at 27.2 percent, financial corporations at 19.2 percent and the other sectors at 3.1 per cent.
As at the end of February 2016, narrow money stock (M1) when measured on year-on-year basis, grew by 6.8 per cent to OMR5.2 billion. This rise was a result of increase in currency with the public by 6.6 percent coupled with increase in Rial Omani designated demand deposits by 6.8 per cent.
Quasi-money (Omani rial savings and time deposits, certificates of deposit issued by commercial banks, margin deposits) and foreign currency denominated deposits witnessed a growth of 8.5 per cent during the period.
Broad money supply M2 (M1 and quasi-money) stood at OMR15.2 billion at the end of February 2016, up from OMR14.1 billion a year ago, registering an increase of 7.9 per cent during the period.
In respect of domestic interest rate structure of conventional banks, the weighted average interest rate on Omani rial deposits firmed up from 0.952 percent in February 2015 to 0.980 per cent in February 2016 while the weighted average Omani rial lending rate declined from 5.051 per cent to 4.772 percent during the same period.
The overnight Omani rial domestic inter-bank lending rate firmed up to 0.356 percent in February 2016 from 0.130 per cent a year ago.