Islamic Banking Entities Provide Financing of RO3 Billion

Islamic banking entities provided financing to the extent of RO3 billion as at the end of November 2017 as compared to RO2.4 billion a year ago, according to the bulletin released by the Central Bank of Oman (CBO).

Total deposits held with Islamic banks and windows also registered a significant increase to RO2.9 billion in November 2017 from RO2.1 billion as at the end of November 2016.

The total assets of Islamic banks and windows combined, amounted to RO3.7 billion as at the end of November 2017, constituting about 11.9 percent of the banking system assets.

With regard to monetary aggregates as at the end of November 2017, narrow money stock (M1) registered a year-on-year (YoY) a decline of 1.4 percent to RO5 billion. 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 5.8 percent during the period. Broad money supply M2 (MI plus quasi-money) stood at RO16.1 billion as at the end of November 2017 and grew by 3.5 percent during the same period.

In respect of domestic interest rate structure of conventional banks, the weighted average interest rate on RO deposits increased to 1.677 percent in November 2017 from 1.443 percent a year ago while the weighted average RO lending rate increased to 5.215 percent from 5.081 percent during the same period.

The overnight Rial Omani domestic inter-bank lending rate stood at 1.214 percent in November 2017, much higher as compared to 0.475 percent a year ago. The average Repo rate for liquidity injection by the CBO stood at 1.767 percent per annum during the month of November 2017. The overall hardening of interest rates reflects some tightening of liquidity in the banking system.

Source: Oman News Agency