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Muscat: The stability of Oman’s macro-financial system has shown improvement in 2023, despite the diminished forecast for global growth, and ongoing geopolitical uncertainty, Central Bank of Oman (CBO) said in its latest report.
Most (71 percent) of the respondents are fairly confident in the Omani macro-financial system, the annual Systemic Risk Survey (SRS) conducted by CBO reveals.
“The percentage of respondents who described themselves as ‘very confident’ or ‘fairly confident’ or ‘Just Confident’ in Oman’s macro-financial system increased to 100 percent in 2023 compared to 99 percent in 2022. Meanwhile, the responses in favour of ‘Not at All Confident’ dropped to zero percent in 2023 from one percent in the preceding year,” the survey reveals.
The respondents’ confidence in the Omani macro-financial system increased in 2023 according to the SRS 2023. In SRS 2023, 97 percent of the respondents reported an increase or at least unchanged in their confidence over the last year preceding taking the survey, compared to 92 percent in 2022. “Only three percent of participants in SRS 2023 responded that their confidence ‘decreased’, compared to 8 percent in SRS 2022.
According to the SRS 2023 responses, the perceived probability of an event with a high negative impact occurring in Oman’s financial system over the short-term (up to one year ahead) dropped slightly. Only six percent of the respondents judged this probability to be ‘high’ or ‘very high’ in 2023, compared to eight percent in SRS 2022.
Moreover, the percentage of respondents who viewed this probability as ‘Low’ or ‘Very Low’ increased from 55 percent in 2022 to 60 percent in 2023. The participants’ expectations of such an event occurring over the medium term (1-3 years ahead) witnessed a larger change between 2022 and 2023. The percentage of respondents who viewed this probability as ‘High or Very High’ somewhat declined to18 percent in 2023 from 20 percent in 2022. Whereas, the percentage of those who judged this probability as ‘Low or Very Low’ decreased significantly to 18 percent in 2023 from 39 percent in 2022. The lower probabilities assigned to a high-impact event reflect the substantial improvements in Oman’s fiscal and economic metrics, particularly in the short-term, mainly due to the higher oil prices and the continued commitment to the medium-term fiscal plan (MTFP).
The annual SRS conducted by CBO seeks to obtain feedback from a range of stakeholders on their level of confidence in the stability of the Omani macro-financial system, as well as their perception of associated risks. The survey is typically completed by officials from banks, non-bank financial institutions, finical sector regulators, government institutions, professionals from the public and private sectors, and academics in the fields of finance and economics.
The results discussed in this note are based on the responses gathered during January 2023 edition of the survey, the survey stated.
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