Satyendra Pathak
Doha
The total assets of Qatar’s banking sector witnessed a significant growth, rising by 1.2 percent month-on-month (MoM) and 1.5 percent since the beginning of 2024, reaching QR1.999 trillion in June 2024, as revealed by QNB Financial Services (QNBFS) in a report published onWednesday.
According to the report, the banking sector’s loan book increased by 0.4 percent MoM, reflecting a 2.9 percent rise in 2024. Conversely, deposits saw a slight decline MoM but rose by 4.6 percent over the year. This shift resulted in the Loan-to-Deposit Ratio (LDR) increasing to 128.4 percent in June 2024, up from 127.9 percent in May 2024.
The growth in the overall loan book was primarily driven by the private sector, which saw a 0.7 percent MoM increase in loans, equating to a 1.8 percent rise since the beginning of the year. The services segment, contributing approximately 32 percent to private sector loans, was a key driver for the second consecutive month, growing by 1.3 percent MoM and 3.7 percent in 2024.
The real estate segment, which represents around 20 percent of private sector loans, grew by 1.0 percent MoM and 4.3 percent in 2024. General trade, contributing 22 percent to private sector loans, increased by 0.2 percent MoM and 3.0 percent in 2024. However, the consumption and others segment, making up 20 percent of private sector loans, declined by 0.8 percent MoM and 3.3 percent in 2024.
Public sector loans saw a marginal increase of 0.1 percent MoM, translating to a 3.8 percent rise in 2024. The government institutions segment, which constitutes 66 percent of public sector loans, was the main contributor, increasing by 0.6 percent MoM and 4.7 percent in 2024.
The semi-government institutions segment grew by 1.0 percent MoM, although it declined by 9.1 percent in 2024. In contrast, the government segment, representing 29 percent of public sector loans, decreased by 1.4 percent MoM but grew by 4.5 percent in 2024. Loans outside Qatar fell by 1.8 percent MoM but showed a strong 12.9 percent growth in 2024.
Public sector deposits dropped by 2.4 percent MoM but increased by 7.1 percent over the year. The government institutions segment, representing 56 percent of public sector deposits, decreased by 3.2 percent MoM but rose by 6.4 percent in 2024.
The semi-government institutions segment fell by 2.8 percent MoM and by 13.9 percent in 2024. The government segment, which makes up 32 percent of public sector deposits, declined by 0.9 percent MoM but saw a significant increase of 19.8 percent in 2024.
Private sector deposits saw a slight gain of 0.1 percent MoM, marking a 0.8 percent increase since the start of 2024. Within the private sector, the companies and institutions segment grew by 0.6 percent MoM but declined by 4.3 percent in 2024.
Meanwhile, the consumer segment edged down by 0.3 percent MoM but increased by 5.3 percent in 2024. Non-resident deposits showed a notable increase of 4.3 percent MoM, reflecting a 10 percent rise in 2024.
Qatar’s banking sector loan provisions to gross loans stood at 4.1 percent in June 2024, up from 3.9 percent in May 2024. The sector’s liquid assets to total assets ratio improved to 30.7 percent in June 2024, compared to 30.1 percent in the previous month.
This detailed analysis of Qatar’s banking sector for June 2024 highlights the ongoing growth and resilience of the sector, driven by robust private sector lending and strategic management of assets anddeposits.