Kuwait Economy On Track To Recovery; KD 2.5b loan given in 5 months – ARAB TIMES

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KUWAIT CITY, July 7: Loans extended by Kuwait’s banking sector continued to grow last May, bringing all types of loans extended to all sectors of the economy to about 2.5 billion dinars within the first five months of 2022 and reached a new record level of 44.8 billion dinars at the end of May last year, reports Al-Anba daily. On a monthly basis, loans granted by Kuwaiti banks last May increased by 1.6 percent to 722 million dinars compared to last April, which ended up with 44.1 billion dinars in loans.

This rise coincides with the sharp recovery in the Kuwaiti economy since the beginning of this year, helped by the rise in oil prices to record highs and the gradual improvement in the pace of consumption. The increase in consumer credit granted for the purchase of durable goods and cars continued for the fourth consecutive month, registering a monthly increase of 0.75% last May with a value of 14,000 dinars to 1.86 billion dinars, compared to 1, 85 billion dinars the year before last April.

While installment loans granted to Kuwait for the purpose of home renovation or purchase rose 1% last May to a record RSD 14.99 billion compared to RSD 14.84 billion at the end of April, showing strong annual growth in comparison from 13.9% to the level in May last year of 13.16 trillion dinars.

In addition, credit growth was boosted by increasing the growth of credits for purchase of securities, with a monthly increase of 13.5% to a record level of RSD 3.509 billion last May, compared to RSD 3.091 billion in April last year. and also recorded an annual increase of 38.97% compared to its level in May last year in the amount of RSD 2.525 billion. The oil and gas sector saw a monthly increase of 1.14% to a record level of RSD 2.293 billion last May, compared to RSD 2.267 billion in April last year. While it recorded an annual increase of 15.86% compared to the level in May last year, which amounted to RSD 1.979 billion. With economic activity returning to pre-coronavirus levels and Kuwait’s oil production ramping up in line with agreed quotas and oil prices continuing to rise, credit is expected to receive additional support in the coming period as well, with a strong increase in the growth of non-oil Economy of Kuwait.

As for the deposits of the banking sector, we note that in May they increased by 0.65% and reached the level of 47 billion dinars compared to the level of 46.69 billion dinars reached in April. This increase is due to the Central Bank of Kuwait’s prudent policy of raising interest rates in conjunction with Federal Reserve decisions over the past period. The government raised RSD 77 million of its deposits last May, bringing total state deposits in the banking system to RSD 7.178 billion, with a monthly increase of 1.08% from RSD 7.101 at the end of April.

On an annual basis it increased by 1.22% compared to its level in May last year, which amounted to RSD 7.091 billion. The government pumped 87 million dinars out of its coffers within a year. At the private sector level, deposits in Kuwaiti dinar increased by 0.56% per month in May, reaching 37.150 billion dinars by the end of the month after the private sector pumped 210 million dinars in deposits into Kuwaiti dinars.

Deposits of the private sector in dinars increased annually to 2.564 billion dinars compared to the level in May last year, which was 34.586 billion dinars, at a rate of 7.41%. Central bank data showed that Kuwait’s foreign exchange reserves rose to RSD 15.04 billion at the end of May, up 4.3% monthly from April’s level of RSD 14.41 billion.

The country’s reserves included about RSD 13.39 billion, the balance of deposits and foreign exchange abroad, in addition to about RSD 1.33 billion of Kuwait’s special drawing rights at the International Monetary Fund. It also consists of about 234.2 million dinars in balance with the International Monetary Fund. Kuwait’s foreign exchange reserves include gold (in the amount of 79 tons, calculated at book value since purchase) of approximately RSD 31.7 million by the end of May 2022, while the foreign exchange reserves are known not to represent the foreign assets of the General Investment Authority represented by the sovereign contain funds.





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