Muscat – Oman’s banking sector saw total credit outstanding grow by 4.8% year-on-year, reaching RO31.9bn by the end of October 2024, according to the Central Bank of Oman’s data.

Private sector lending accounted for the largest portion of total credit, rising 4.4% year-on-year to RO26.8bn as of October 2024. Within this, the household sector remained the largest recipient, capturing 45.2% of total private sector credit, closely followed by non-financial corporations at 45.1%. Financial corporations received 6.2%, while the remaining 3.5% went to other sectors.

Conventional banks reported a 2.7% year-on-year increase in total credit, which reached RO20.7bn by the end of October. Their investments in securities surged 29.7%, amounting to RO6.1bn. Investment in government development bonds, however, declined by 0.7% to RO1.9bn, while investment in foreign securities saw a dramatic increase of 75.1%, reaching RO2.5bn.

Meanwhile, Islamic banking entities in Oman posted a 13.8% increase in financing, reaching RO6.7bn in the first ten months of 2024. The total assets of Islamic banks and windows grew 16.4% to RO8.3bn, representing approximately 18.7% of the banking system’s total assets at the end of October.

Deposits surge

Deposits across Oman’s banking sector grew by a robust 13% to reach RO31.9bn at the end of October 2024. Private sector deposits increased 9.4%, totaling RO20.4bn. Household deposits made up the largest portion of private sector deposits at 50.2%, followed by non-financial corporations at 29.5%. Financial corporations contributed 17.7%, with the remainder coming from other sectors (2.6%).

Conventional banks saw total deposits rise 10.4% year-on-year to RO25.4bn by October 2024. Government deposits with conventional banks grew by 1.8%, reaching RO5.3bn, while deposits from public enterprises surged 50.1%, totaling RO2.8bn. Private sector deposits at conventional banks, accounting for 63.2% of total deposits, rose by 5.3% to reach RO16.0bn.

Deposits at Islamic banks and windows jumped 24%, reaching RO6.5bn.

On the interest rate front, the weighted average interest rate on Omani rial deposits with conventional banks increased to 2.709% by the end of October 2024, up from 2.531% a year earlier. Similarly, the weighted average lending rate rose to 5.628% from 5.452% over the same period.

Meanwhile, the overnight domestic inter-bank lending rate for the Omani rial fell to 4.681% in October 2024, down from 5.584% a year ago. This decline reflects a drop in the average repo rate for liquidity injection by the Central Bank of Oman, which decreased to 5.50% from 6.00%, in line with US Federal Reserve moves.

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