Steady rise in banks’ credit facilities; service sector overtakes real estate

Qatar Central Bank has released its monthly bulletin October 2019, which included a wide range of money and banking statistics for the month of October. QCB has in the past weeks issued some important statistical data contained in the bulletin, including the Bank’s international reserves, Reserves, Liquidity, Assets and Liabilities, Domestic and Foreign. Other details of Deposits, Domestic Credit and Money Supply are presented in this report.

Bank Deposits 
After rising last September, Bank Deposits declined in October 2019 by about QR6.5bn from September to the level of QR 825.3bn; and distributed between Private Sector Deposits, Public Sector Deposits and Non-Resident Deposits. While Private Sector Deposits declined to QR366.9bn compared to QR 368.7bn in September, Public Sector Deposits decreased by QR 6.3bn to QR259.5bn, and Non-Resident Deposits rose by QR1.62bn to QR198.8bn.

Total Credit Facilities
Total Facilities granted by banks grew steadily and reached in October 2019 to QR1003.3bn from     QR QR995.8bn in September, and QR937.3bn a year ago.

Credit granted to the Public Sector rose in October 2019 by about QR2bn up from September to reach the level of QR 286.5bn, but it was still down by about QR38.3bn from a year ago – due to the government repayment of part of its debt to banks. On the other hand, the Credit granted to the private sector increased in October by about QR5bn from September to reach QR639.6bn, and it was about QR109.2bn higher than a year ago. Although credit granted abroad increased by half a billion from September to QR77.2bn, it was still below the level of a year ago of QR82.2bn.

In the details of credit to the Domestic private sector, we find that the credit granted to the Services Sector was the fastest growing, doubling in almost two years and ranked first in last October by about QR163bn compared to QR 161bn in September, and QR117.7bn in October 2018. Credit of the Real Estate sector came in second place but fell by about QR1.5bn from September to QR 150.8bn.

Retail Sector credit fell to third place, slowing its growth to QR132.9bn in October 2019 compared to QR131.4bn in September and QR126.5bn a year earlier. Credit to the Contractors Sector, stabilized in October at QR35.1bn, but down QR1.1bn from October 2018. The credit to the Industrial Sector, rose from last September by about QR0.6bn to QR17.6bn.

The bulletin also included figures of Money Supply in its various concepts, the most important of which is Narrow Money Supply (M1) and Broad Money Supply (M2).

The narrow supply of money (M1) consists of both public currencies in riyals plus demand deposits in riyals for the private sector, government institutions and semi government.

The broad money supply (M2) consists of the Narrow Money Supply (M1), in addition to Quasi Money, which in turn consists of Time Deposits in riyals, Foreign Currency Deposits of the Private sector, Government Institutions and Semi-Government. At the end of October 2019, the Money Supply (M2) declined by 2.1 percent to the level of QR559bn. The decrease came as a result of the Narrow Money Supply (M1) decrease by 1.6 percent, and the quasi-money decrease by 3.1 percent.

(The views published in this column are those of the author and do not necessarily represent or reflect the views of The Peninsula)

Source from: The Peninsula