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Qatar banks’ credit to real estate surges 29.5% in Q3

Qatar banks’ credit to real estate surges 29.5% in Q3

DOHA: Qatar banks’ credit to real estate sector jumped 29.5 percent in the third quarter of 2015 (Q3, 2015) year-on-year. Qatar Central Bank’s (QCB) latest data showed the credit distribution to the sector hit at QR114bn in September 2015, compared to QR88bn a year ago.

Commercial banks’ total domestic credit rose to QR633bn in Q3, from QR617bn in the previous quarter. Private sector credit jumped to QR409bn from QR394bn in Q2.

Credit facility to the industries sector increased to QR12bn from QR10bn, a year ago. Credit to the contracting portfolio also grew to QR37bn, from QR28bn.

Public sector credit declined to QR223bn in September 2015 from QR239bn reported a year ago. Total assets rose to QR1.06 trillion in September 2015, compared to QR982bn during the same month in 2014.

Qatar banks’ credit facility to outside the country jumped 25 percent during the third quarter year-on-year.

The banks’ credit to outside Qatar increased to QR75bn in September, compared to QR60bn recorded a year ago. Total domestic credit also jumped to QR633bn in Q3 from QR572bn.

According to QCB data, the country’s non-oil sector contribution to the total GDP increased to 53.1 percent during the second quarter of 2015, up from a share of 49.6 percent during the previous quarter.

Oil sector’s share slipped to 46.9 percent in Q2,15 from 50.4 percent in Q1,15.

Meanwhile, QNB’s monthly monitor yesterday noted growth in bank deposits fell marginally in September on a contraction in public sector deposits. Bank deposits year-on-year growth fell marginally to 7.1 percent in September 2015 from 7.2 percent in August.

Public sector deposits contracted by 13.9 percent, private sector deposits grew by 12.0 percent while non-resident deposits doubled, growing by 120.2 percent. QNB expects deposit growth to reach 9.5 percent in 2015 reflecting strong population growth.

Asset growth fell to 8.7 percent in September 2015 from 11.8 percent in August.

Foreign assets grew by 5.5 percent year-on-year, driven by expansion in credit (24.5 percent); while domestic assets grew by 11.0 percent, also driven by the growth in domestic credit (10.7 percent).

QNB expects growth in bank assets to reach 10.5 percent in 2015, increasingly driven by project lending and population growth. Banking credit growth fell in September on the contraction in public sector borrowing. Bank loan growth slowed to 12.0 percent year-on-year in September 2015 from 17.3 percent in August.

According to QNB, Qatar banks’ loans to the public sector contracted by 6.6 percent year-on-year while lending to the private and foreign sectors grew strongly by 23.1 percent and 24.5 percent respectively. QNB forecasts that bank lending will grow by 10.5 percent in 2015, increasingly driven by project lending and the expanding population.