The broad money supply in Oman experienced an increase of 12 percent on an annual basis, reaching approximately OMR23.6 billion by the end of April 2024. This growth was attributed to the rise in both narrow money by 7 percent and quasi-money by 13.9 percent. Quasi-money includes total savings deposits, time deposits in Omani riyals, certificates of deposit issued by banks, margin accounts, and all foreign currency deposits in the banking sector. Cash held by the public decreased by 7 percent, while demand deposits saw an increase of 11.2 percent.
In terms of interest rates in conventional banks, the weighted average interest rate on deposits in Omani rials rose from 2.192 percent in April 2023 to 2.580 percent by April 2024. Similarly, the weighted average interest rate on loans in Omani rials increased from 5.366 percent to 5.604 percent during the same period. The average interest rates for one-night interbank lending also saw a slight increase, attributed to a rise in the weighted average interest rate on repurchase operations to 6.000 percent compared to 5.500 percent the previous year.
Islamic banking in Oman also showed positive growth, with the total assets of Islamic banks and windows combined reaching about OMR7.5 billion by the end of April 2024. This represents 17.7 percent of the total assets of the banking sector in Oman, marking a 13.2 percent increase from the previous year. The total financing balance provided by Islamic banking units rose by 12 percent to OMR6.3 billion, while deposits at Islamic banks and windows increased by 15.9 percent to around OMR5.8 billion by the end of April 2024.
The statistics released by the Central Bank of Oman highlight the continuous growth and stability of the banking sector in the Sultanate. The increase in money supply and assets in both conventional and Islamic banking sectors indicate a positive trend in Oman’s financial stability. With interest rates showing a slight increase and deposits and financing balances on the rise, it is evident that the economy is growing and attracting more investment, which will contribute to further development and prosperity in the country.
Overall, the banking sector in Oman is showing strength and resilience in the face of economic challenges. The consistent growth in money supply, assets, and financing balances in both conventional and Islamic banking sectors reflects a healthy and stable financial environment in the country. With increasing interest rates and deposits, Oman’s financial landscape is poised for continued growth and prosperity in the coming years.
