Qatar banking sector sees growth in deposits, promising rise in private sector credit in November 2023: QNBFS

Overall growth in deposits and a promising rise in private sector credit were the highlights of the latest Qatar Banking Sector update by QNB Financial Services (QNBFS).
Driven by the government segment, deposits with Qatari banks inched up 0.2% during November 2023 to reach QR981.5bn, QNBFS said Monday.
The country’s private sector remained resilient with total sector loans going up 0.8% MoM (+4.2% in 2023) in November last year, QNBFS noted.
The Qatai banking sector's total assets went up 0.4% MoM (up 2.2% in 2023) in November 2023 to reach QR1.946tn, while total loan book edged lower by 0.2% MoM (up 1.4% in 2023) to QR1,273.4bn.
The public sector pushed the overall credit lower. As deposits went up in November, the loans to deposits ratio (LDR) declined to 129.7% vs. 130.3% in October 2023.
The overall loan book was slightly down 0.2% in November 2023. Total public sector loans declined 2.5% MoM.
Loans moved up by 1.4% in 2023, compared to a growth of 3.3% in 2022. Loans grew by an average 6.7% over the past five years (2018-2022).
Loan provisions to gross loans was at 3.9% in both November and October 2023, QNBFS noted.
The government segment (represents 27% of public sector loans) was the main drag on the public sector with a drop by 9.0% MoM (-15.2% in 2023), while the semi-government institutions’ segment declined by 5.4% MoM (+23.9% in 2023).
However, the government institutions’ segment (represents 66% of public sector loans) moved up 0.8% MoM (-0.8% in 2023).
Total private sector loans went up 0.8% MoM (+4.2% in 2023) in November 2023. Consumption and others, general trade and services segments were the main drivers for the private sector loan rise.
Consumption and others (contributes 21% to private sector loans) increased 2.2% MoM (+7.7% in 2023), while general trade (contributes 21% to private sector loans) went up 1.7% MoM (+7.6% in 2023), and services (contributes 31% to private sector loans) moved up 1% MoM (+10.1% in 2023).
However, the real estate segment (contributes 20% to private sector loans) went down 1.0% MoM (-6.5% in 2023) in November 2023. Outside Qatar loans edged up by 0.2% MoM (-2.7% in 2023) during the month of November 2023.
Non-resident deposits increased 1.3% MoM (-5.2% in 2023) in November 2023, QNBFS said.
Public sector deposits went up 0.4% MoM (-5.4% in 2023) in November 2023.
Looking at segment details, the government segment (represents 29% of public sector deposits) increased by 4.4% MoM (-10.4% in 2023).
However, the government institutions’ segment (represents 55% of public sector deposits) went down 0.8% MoM (-6.3% in 2023), while the semi-government institutions’ segment declined 2% MoM (+9.0% in 2023) in November 2023.
Private sector deposits moved lower by 0.3% MoM (+2.5% in 2023) in November 2023. On the private sector front, the companies and institutions’ segment went down slightly by 0.5% MoM (-1.9% in 2023), while the consumer segment edged down by 0.2% MoM (+6.8% in 2023) during November 2023.
According to QNBFS, the deposits gain in November 2023 was mainly due to an increase by 1.3% in non-resident deposits and by 0.4% in the public sector.
Deposits went down by 1.8% in 2023, compared to a growth of 2.6% in 2022. Deposits grew by an average 4% over the past five years (2018-2022)
Loan provisions to gross loans was at 3.9% during both November and October 2023.
The sector’s liquid assets to total assets was at 31.4% in November 2023, compared to 31.1% in October 2023.
An analyst told Gulf Times: “The main highlights for the month of November 2023 is the overall growth in deposits and the promising rise in private sector credit. The overall growth in deposits was driven by the government segment as oil and gas prices remained buoyant, adding to government revenues.
“Even as overall loans declined due to the cutback in short-term funding for the government through overdrafts, the private sector remained resilient with gains in private consumption, general trade and the tourism sector.”