The monthly report of QNB Financial Services on the performance of the banking sector in the State of Qatar revealed that the total assets of the banking sector in Qatar decreased by 0.6% on a monthly basis (down by 1.3% in 2023) in May 2023 to 1.880 trillion riyals.
The report added: In May 2022, total banking sector loans in Qatar increased by 0.2% compared to the previous month (down by 0.3% in 2023) and deposits decreased by 1.0% on a monthly basis (-4.5% in 2023).
The private sector pushed up total credit. With deposits decreasing by 1.0% in May, the loan-to-deposit ratio increased to 131.2%, compared to 129.6% in April 2023.
In May 2023, the total loan portfolio increased by 0.2%. Loans to the domestic private sector increased by 0.5% compared to the previous month (+0.7% in 2023).
The services sector formed the main driver for the increase in private sector loans, and the services sector (which contributes about 30% to private sector loans) increased by 1.3% compared to the previous month (1.7% in 2023), while the consumption and other services sector increased (which contributes about 20% in private sector loans) by 1.3% compared to the previous month (0.1% in 2023).
The general trade sector (contributing 21% to private sector loans) increased by 0.8% compared to the previous month (+2.6% in 2023). In contrast, the real estate sector (contributing 22% to private sector loans) declined by 1.1% MoM (-1.1% in 2023) in May 2023.
Total public sector loans decreased by 0.2% compared to the previous month (-2.5% in 2023). The government sector (which accounts for about 28% of public sector loans) decreased by 1.1% month-on-month (-12.1% in 2023), while the semi-government sector declined by 1.5% month-on-month (-3.4% in 2023). In contrast, the loan book of government institutions (representing 67% of public sector loans) increased by 0.3% compared to the previous month (+2.3% in 2023). In addition, the rate of loans outside Qatar decreased by 1.5% compared to the previous month (-1.1% in 2023) during the month of May 2023.
Public sector deposits decreased by 2.1% MoM (-6.1% in 2023) in May 2023. Looking at the sector breakdown, the government sector (which accounts for about 28% of public sector deposits) played the main role in the decline with a decrease of 7.9%. % compared to the previous month (-12.0% in 2023), while the semi-governmental sector decreased by 3.0% compared to the previous month (-21.1% in 2023). In contrast, the Government Enterprises sector (which accounts for about 60% of public sector deposits) increased by 1.1% MoM (0.7% in 2023) in May 2023.
Non-resident deposits returned to their general declining trend with a decrease of 2.7% MoM (-8.4% in 2023) in May 2023, after a rise of 0.4% in April 2023 and an increase of 2.8% in March 2023.
Private sector deposits increased by 0.5% MoM (-1.5% in 2023) in May 2023. On the private sector front, the corporate and institutional sector increased by 0.8% MoM (-6.8% in 2023), while the consumer sector rose by 0.3% compared to the previous month (+3.8% in 2023) during May 2023.
Qatar’s banking sector loan allocations to total loans were 3.8% in May 2023, compared to 3.7% in April 2023.
The Qatari banking sector’s liquid assets to total assets decreased by 30.4% in May 2023, compared to 31.0% in April 2023.
