Mashallah! Kuwait's credit hits 5-year high
Year-on-year, the sector’s debt to the domestic banking sector shrank by 19 per cent.
Kuwait's bank credit increased by KD391 million ($1.37 billion) in October, pushing year-on-year growth to 7.8 per cent and marking the largest monthly gain in five years, a report said. October’s data confirms the accelerating trend in credit growth which exceeded previous expectations, added the latest Economic Update released by the National Bank of Kuwait (NBK). October’s strength was particularly visible in growth of non-financial business credit which accelerated to its most rapid pace since the financial crisis. Household credit grew at a more moderate pace gaining by KD47 million. Growth eased to 16.7 per cent year-on-year from the 18 per cent pace maintained over the past five months. Despite this, the sector remains the largest contributor to credit growth accounting alone for 29 per cent of total credit and about half of all credit gains year-to-date. The non-financial business sector’s strong gain of KD365 million was behind October’s exceptional performance, according to the update. Growth in credit to the sector accelerated to 7.3 per cent. An unusual increase of KD71 million in credit to the oil & gas sector coupled with strong increases in lending to the trade and real estate sectors helped propel the sector in October. Meanwhile, the non-bank financial sector remained in deleveraging mode, registering a KD21 million drop in credit. Year-on-year, the sector’s debt to the domestic banking sector shrank by 19 per cent. Private sector deposits saw a second consecutive month of sizeable gains, adding KD468 million on the month. KD time deposits (+KD171 million) and foreign deposits (+KD 209 million) drove the increase, while dinar sight deposits and savings deposits experienced modest growth. As a result, money supply saw another strong month. Broad money (M2) expanded by KD 466 million, leading year-on-year growth to accelerate to 10.6 per cent from 9.6 per cent in October, said NBK in the update. The narrower M1 measure increased by only KD 72 million, with growth slowing to 19 per cent from a month ago. Deposit rates on dinar time deposits remained steady at relatively low levels. Average rates remained unchanged for 1-month, 3-month, 6-month, and 12-month time deposits at 0.56 per cent, 0.74 per cent, 0.94 per cent, and 1.12 per cent, respectively, the report said.
- Will terror attacks damper Arabs' appetite for European holidays?
- So cool it's hot: Saudi Arabia's $3.2B HVACR market driven by construction boom
- US, EU protectionist policies may be a blessing in disguise for GCC suppliers
- Dubai to Doha: How far can you stretch your dirham?
- OPEC's poor history of compliance will make production cut deal a challenge