https://d5nxst8fruw4z.cloudfront.net/atrk.gif?account=pUuXo1IWhd10Ug
logo
Commercial banks in Oman upbeat on growth
May 18, 2019 | 7:21 PM
by ONA
Unaudited financial results of the listed commercial banks in the first quarter of 2019 showed positive indicators of revenues, profits and assets growth. -ONA
 
Sharelines

Muscat: Commercial banks listed at Muscat Securities Market (MSM) predicted that government spending in 2019 will reflect on banking sector activities and support the growth witnessed by the sector.

Ahli Bank said in its quarterly report to shareholders that the improvement in oil prices led to the provision of necessary assistance to the economy while reducing the deficit in the state budget.

The report forecast that the rise in oil prices and the profits of hydrocarbon production will increase the government’s capital expenditure, which will positively affect the economy and financial markets.

It pointed out that the intensive efforts of the government in economic diversification through enhancing the participation of the private sector, encouraging partnership between the public and private sectors and other various initiatives, which was included in the state budget for the current year would achieve positive results, develop the economy and generate large investments in various areas, such as manufacturing, tourism and logistics, sectors that support the growth of the banking sector.



BankMuscat praised the policies initiated by the Sultanate to enhance the performance of the national economy, describing these policies as “far-sighted and appropriate to the market economy”. The Bank affirmed that its Board of Directors supports the measures taken by the Central Bank of Oman (CBO) and the Capital Market Authority (CMA) to improve the performance of the banking sector.

During 2019, the Tender Board awarded more than OMR458.7 million worth projects, which is expected to lead to the recovery of a number of economic sectors and the enhancement of infrastructure performance in the country.



The banks confirmed that they support the government’s efforts to enhance the performance of the national economy by financing major projects.

BankMuscat said it has provided long-term loan facilities to a project aimed at developing renewable energy in the Sultanate and has participated in a joint venture deal to finance a new project in the oil and gas sectors.

The unaudited financial results of the listed commercial banks in the first quarter of 2019 showed positive indicators of revenues, profits and assets growth.

According to data provided by Oman News Agency, the unaudited net profits of the six commercial banks listed at MSM increased in the first quarter of 2019 to OMR96.5 million compared to OMR95 million in the same period in 2018.

The net profits of BankMuscat, Ahli Bank, HSBC Oman and Sohar Bank increased while Bank Dhofar and the National Bank of Oman recorded a slight decline in their net profits.

At the end of March 2019, the assets of the six commercial banks increased by 4.5 percent from a year ago to OMR27.7 billion compared to OMR26.5 billion in March 2018.

Several banks, despite their optimism, have reiterated their commitment to a cautious policy due to fluctuating oil prices, saying that this year still poses real challenges to the banking sector.

HSBC said it imposed strict cost control in the first quarter of 2019, which contributed to the growth of the revenues of the bank, which also focused on the growth of the customer base.

Bank Dhofar praised its financial performance and lending initiatives launched in the first quarter of 2019. It said that these initiatives contributed to the bank’s growth by 4.7 per cent in total assets, which increased by the end of last March to about OMR4.4 billion, compared to OMR4.2 billion in March 2018.

Bank Sohar said that it will continue to make every effort to achieve fruitful and sustainable growth.

The National Bank of Oman described its performance in the first quarter of 2019 as good. The bank said it was able to reduce the impact of the decline in net interest income by compensating for growth in unfunded income. It stressed that its strategy focuses on diversifying income sources at the service level, retail and corporate banking without exposing capital to high risk sectors.

The bank explained that in recent years, it has been working to reduce its exposure to high-risk sectors, especially in the real estate sector, offsetting growth in revenue by diversifying fee income and growth in all its operations. The bank said that it has reinforced, in the last quarter of 2018, the growth of its loan portfolio in a very selective manner and it has re-priced its current assets, reflecting the increase in financing costs.

Bank Sohar said that it is expecting an increase in demand for financing in the near future due to the marked improvement in oil prices and the government commitment to continue investing in infrastructure projects, as well as government investment in specific sectors as part of the trend to diversify the national economy. The bank affirmed in its progress report that it has the potential to continue to build on its path of banking excellence and to give positive value to enhancing the national economy.

The consolidated financial results of the six commercial banks listed at MSM as at the end of March 2019 indicated a rise in their capital to

RO1.327 billion, constituting a growth of 6.4 percent, compared to RO1.247 billion in 2018

.

STAY UPDATED
Subscribe to our newsletter and be the first to know all the latest news