Friday 26 / April / 2024
Muscat: Bank liquidity in Oman is improving and financial institutions are in a comfortable position now, according to bankers, who attended the “New Age Banking Summit Oman” here on Wednesday.
“The liquidity situation is improving now. We had undergone some cycles and now we are coming back to normalcy,” Abdul Hakeem Omar Al Ojaili, chief executive officer of BankDhofar said, while addressing a panel discussion at the summit.
The financial system in Oman had faced a stress on bank liquidity last year, following withdrawal of deposits by state-owned enterprises and debt issues in the domestic market.
However, total deposits of Omani banks registered a growth of 7.1 per cent to OMR20.8 billion as of the end of February 2017, according to the latest monthly statistics released by Central Bank of Oman (CBO) recently.
The CBO report pointed out that private sector deposits in the banking system registered a growth of 7.2 per cent to OMR13.7 billion as of the end of February 2017. Omani banks, including Islamic institutions, achieved a year-on-year growth of 8.1 per cent in credit to OMR22.2 billion by the end of February 2017.
Al Ojaili further said the challenges faced by financial institutions are similar to any other business cycle. The banking sector in Oman has always been kept under close monitoring and support from CBO in anticipation of challenges that are expected in the market.
Delivering the key note address, Hamood Sangour Al Zadjali, executive president of CBO, said that the banking sector in Oman, both conventional and Islamic, has done well in 2016 too. “While they registered a credit growth of 7.6 per cent in the year, retention and capital adequacy levels have been kept up. Banks in Oman are swift in adopting new modes of service delivery and technologies. Technology spend is quite considerable – one reason banks state generally as justification for higher charges. It should be added that banking public in GCC countries are tech-savvy. It is particular so in Oman in the context of higher and increasing young population,” said Al Zadjali. “As many as 27 per cent of respondents, in one recent sample survey, indicated that they use mobile banking applications and as many as 51 per cent of holders of university degree or higher education confirmed so.”
“While there will be cost saving in some respect, the initial cost can be high and it takes time to pay off,” he said, while emphasising on the challenges faced by banks in implementing advanced technology. Al Zadjali stated that technology in the banking sector is constantly improving and the focus should always be on customers. There has to be a balance between capital and operating expenditures.
Meanwhile, Al Ojaili said international investors are looking for opportunities in Oman. The financial sector should play a leading role in attracting investors and financing projects.
Humayun Kabir, director, Kunooz Oman Holding, was the moderator of the panel discussion, which was attended by Abdul Hakeem Omar Al Ojaili, Sulaiman Al Harthy, deputy chief executive officer, Meethaq Islamic Banking, Bank Muscat, Khalid Al Kayed, chief executive officer of Bank Nizwa and Maqbool Al Wahaibi, chief executive officer of Oman Data Park.
New Age Banking Summit
The two-day New Age Banking Summit 2017, which was organised by UMS Conferences and endorsed by the CBO, drew a good response from the banking industry and related sectors on the first day of the event at Sheraton Oman Hotel. The New Age Banking Summit is a unique platform for the banking and finance professionals to discuss the new developments in global banking and debate on the focus areas for Omani banks. The event hosts speakers from Omani and global and regional companies, including Oman Data Park, Meethaq Islamic Bank, Bank Nizwa, Bank Dhofar, Takaful Oman Insurance, BPC Banking Technologies-Switzerland, Bureau van Dijk-UAE, National Bank of Abu Dhabi, Comarch-Poland, Entrust Datacard Group-UAE, Mashreq and ANZ Bank-Singapore.
The day one deliberations helped the audience gain expert insights on disruptive technologies, global banking trends and new age customer needs, and an opportunity to network with industry peers and banking solution providers. Featuring sessions on emerging cyber security challenges, future of mobile payments, sukuks, block-chain and future-proofing the banking environment, the event stressed on driving efficiency across various channels for better monetization as well as the need to be in line with regulatory norms while embracing digitisation.
