DOHA: Loan growth, which is vital to banks’ income growth, was flat for Qatari banks in July, but showed a 6.8 percent increase year-to-date (between January and July, 2015), says a report.
In its July report for Qatar’s banking sector , QNB Financial Services said yesterday that deposit growth of the banks also suffered in the month as it fell by 3.1 percent month-on-month but grew year-to-date by 3.8 percent.
Banks’ credit disbursal suffered in July as dispensation to the public sector dipped by 2.6 percent month-on-month and fell by 6.9 percent year-to-date.
Private sector continued its positive trajectory led by real estate and the contracting sector. But personal loans declined, QNB said. Moreover, public sector deposits contracted by 10.8 percent month-on-month (and down 10.8 year-to-date).
The liquidity to deposit ratio (LDR) jumped to 112 percent in the month as against 108 percent at the end of June.
Public sector deposits contracted by 10.8 percent month-on-month, against an uptick of 1.1 percent month-on-month in June.
Delving into segment details, the government segment contracted by 20.8 percent month-on-month (down 24.7 percent year-to-date) after gaining by 5.8 percent MoM in June (and dropping by 6.0 percent and 6.9 percent in May and April 2015, respectively).
Moreover, the semi-government segment followed suit and declined by 18.8 percent MoM (down 16.8% YTD).
Furthermore, the government institutions’ segment (represents around 62 percent of total public deposits) also posted weak performance, sliding by 4.1 percent MoM (down 2.6 percent YTD). As for the private sector, the companies and institutions’ segment climbed up by 1.5 percent MoM (rising 22.0 percent YTD). On the other hand, the consumer segment declined by 1.2 percent MoM (and down 7.2 percent YTD). Non-resident deposits increased by 5.6 percent MoM (up 48.8 percent YTD). The overall loan book showcased flat performance in July. Total domestic public sector loans declined by 2.6 percent MoM (down 6.9 percent YTD) as against a gain of 3.4 percent MoM in June 2015.
The government segment’s loan book contracted by 11.5 percent MoM (down 18.2 percent YTD) against a strong increase of 17 percent in June.
On the other hand, the government institutions’ segment (represents nearly 63 percent of public sector loans) inched up by 0.6 percent MoM (down 1.9 percent YTD) after exhibiting negative performance in June (down 1.0 percent MoM).
Moreover, semi-government institutions’ segment ticked up by 0.5 percent MoM (down 6.2 percent YTD). Hence, the government sub-segment restrained the growth of the overall loan book for the month of July 2015.
Private sector loans continued its positive trajectory growing by 2.1 percent MoM (up 14.0 percent YTD), said the report.
The Real Estate followed by the Contractors segments positively contributed toward the loan growth. Loans to the Real Estate segment (contributes about 28 percent to private sector loans) expanded by 13.9 percent MoM (a growth of 19.1 percent YTD) while Contractors (contributes 9 percent to private sector loans) climbed up by 3.1 percent MoM (up 19.0 percent YTD).
On the other hand, Consumption & Others segment (contributes about 30 percent to private sector loans) declined by 4.9 percent MoM (up 14.6 percent YTD). Moreover, Services (contributes nearly 17 percent to private sector loans) dipped by 1.4 percent MoM (up 6.4 percent YTD).
