Islamic banks report faster credit growth than conventional peers in November: QCB

The credit extended by Islamic banks in Qatar grew faster than that by traditional lenders and the overall loan growth in the banking sector in November 2022 on an annualised basis, according to the Qatar Central Bank (QCB) data.
The country’s banking sector saw a healthy double-digit expansion in credit extended by foreign Islamic lenders. Moreover, the domestic credit outgo from foreign banks was seen growing faster than that from the local lenders, said the central bank data.
The commercial banks in Qatar witnessed an overall 0.69% year-on-year jump credit to QR1.23tn in November 2022.
In the case of foreign banks, their total credit shot up 15.47% on an annualised basis to QR17.24bn as domestic loans expanded more than 16% to QR17.16bn in November 2022.
The local lenders witnessed a marginal 0.51% growth year-on-year to QR1.21tn in November 2022 as the 1.22% jump in domestic credit was to a great extend masked by an 11% decline in overseas credit.
Within the foreign banks, credit from Arab lenders shot up 17.74% on a yearly basis to QR7.5bn and that from non-Arab by 15% to QR9.66bn at the end of November.
In the case of Qatari banks, the traditional lenders’ credit witnessed a 2.18% shrinkage year-on-year to QR784.23bn; whereas that of Islamic lenders reported a 9.77% increase to QR358.81bn at the end of November 2022.
Of the Qatar banks' total domestic credit of QR1.15tn, the bulk of it went to the public sector, which received QR350.86bn or 31% of the total, followed by services QR236.26bn (21%), real estate QR174.11bn (15%), consumption QR165.38bn (14%), general trade QR159.05bn (14%), contractors QR38.56bn (3%) and industry QR21.23bn (2%).
In the case of local traditional banks, the domestic credit to public sector amounted to QR277.55bn, followed by services QR178.26bn, general trade QR131.35bn, realty QR102.62bn, consumption QR60.65bn, contractors QR20.68bn and industry QR10.42bn in November 2022.
The local Shariah-principled lender's bulk of the domestic credit was directed towards consumption (QR104.73bn), public sector (QR73.31bn), real estate (QR71.48bn), services (QR55.85bn), general trade (QR27.11bn), contractors (QR17.89bn) and industry (QR7.04bn) during the review period.
Within foreign banks, the bulk of domestic credit went to general trade, which constituted 35% of the total or QR6.07bn, followed by contractors 18% (QR3.01bn), public sector 15% (QR2.55bn), services 13% (QR2.17bn) and consumption 10% (QR1.79bn) in November 2022.
In the case of Arab banks, the domestic credit to general trade stood at QR3.1bn, contractors QR1.71bn and services QR1.11bn in November 2022.
The non-Arab banks extended QR2.97bn for general trade, QR2.5bn for public sector, QR1.3bn for contractors, QR1.24bn for consumption and QR1.07bn for services during the review period.