04/20/2024 | Press release | Distributed by Public on 04/21/2024 09:58
The nominal GDP, as per the preliminary data released by National Centre for Statistics and Information (NCSI), showed a decline of 2.8 percent at end of the fourth quarter of 2023 over the same period of 2022. Despite the increase in non-hydrocarbon sector by 1.7 percent, the contraction was driven by decrease in output of the hydrocarbon sector by 11.9 percent. As for the real GDP, it demonstrates an increase of 1.3 percent during the same period under discussion. Similiarly, this expansion was driven by 0.4 percent of hydrocarbon sector and 2.4 percent of non-hydrocarbon sector. The Omani oil average price at end of February 2024 at $80.2 per barrel was lower by 2.0 percent than that in February 2023. The average daily oil production at 1001.0 thousand barrels as of February 2024 decreased by 5.9 percent. The Sultanate's average Consumer Price Index (CPI) showed a Y-o-Y inflation of -0.04 percent as of February 2024.
Other depository corporations (ODCs) consist of conventional and Islamic banks in Oman. Total outstanding credit extended by ODCs grew by 2.7 percent to OMR 30.6 billion at the end of February 2024, with credit to the private sector demonstrating an increase of 3.9 percent (Y-o-Y) to reach OMR 25.8 billion.
Non-financial corporations received the highest share of the total private sector credit at approximately 45.7 percent at end-February 2024, followed by Household sector at 45.3 percent. The share of financial corporations was 5.3 percent while other sectors received the remaining 3.7 percent of total private sector credit as at end-February 2024.
Total deposits held with ODCs registered a Y-o-Y significant growth of 13.3 percent to reach OMR 30.1 billion at the end of February 2024. Total private sector deposits increased by 14.8 percent to OMR 20.1 billion. In terms of sector-wise composition of private sector deposits, the biggest contribution is from household deposits at 48.4 percent, followed by non-financial corporations at 32.3 percent, financial corporations at 16.5 percent and other sectors at 2.8 percent.
The combined balance sheet of conventional banks showed a Y-o-Y growth of 0.4 percent in total outstanding credit as of end-February 2024. Credit to the private sector increased by 1.8 percent to reach OMR 20.1 billion while their overall investments in securities witnessed a increased by 23.9 percent to OMR 5.6 billion at end-February 2024. Investment in Government Development Bonds decreased by 17.0 percent to OMR 1.8 billion, while foreign securities inceased dramatically by 99.1 percent to OMR 2.1 billion, at the end of February 2024. On the liabilities side, aggregate deposits held with the conventional banks inceased by 12.0 percent Y-o-Y to OMR 24.3 billion at end-February 2024. Government deposits with conventional banks witnessed an increase of 0.2 percent at OMR 5.2 billion, and deposits of public enterprises increased by 40.4 percent to OMR 2.3 billion. On the other hand, private sector deposits, which accounted for 66.5 percent of total deposits with conventional banks, increased by 11.6 percent as of February 2024 to reach OMR 16.1 billion.
The total assets of Islamic Banks and Windows increased by 16.0 percent on a Y-o-Y basis to OMR 7.5 billion and constituted about 17.6 percent of the banking system's assets at end-February 2024. Islamic banking entities provided financing of OMR 6.2 billion at the end of February 2024, recording a growth of 12.5 percent over that a year ago. Total deposits held with Islamic banks and windows increased by 18.9 percent to OMR 5.8 billion.
Among the indicators of monetary aggregates, broad money supply M2 at end-February 2024 increased by 15.8 percent to reach RO 23.9 billion. This is attributed to the increased in narrow money (M1) by 6.9 percent, along with 19.3 percent increase in quasi-money (Rial Omani saving and time deposits, certificates of deposit issued by banks, margin deposits and foreign currency denominated deposits). Looking at components of narrow money (M1) during the same period, currency with the public fell by 4.3 percent, while demand deposit increased by 10.0 percent.
The weighted average interest rate on OMR deposits with conventional banks witnessed an increase from 2.125 percent at end-February 2023 to 2.643 percent at end-February 2024, and the weighted average lending rate increased from 5.358 percent to 5.542 percent over the same period. Meanwhile, the overnight Rial Omani domestic inter-bank lending rate rose to 5.123 percent in February 2024 from 4.730 percent a year ago. This is an outcome of the increase in the average Repo rate for liquidity injection by the CBO to 6.000 percent from 5.241 percent a year ago, moving with US Fderal Reserve.