Kuwait registers 8pc credit growth
Kuwait, March 16, 2014
Kuwait witnessed a steady 8 per cent growth in its bank credit in January mainly driven by the household borrowing despite a third consecutive month of declining business credit, said a report.
The household debt remained the most dynamic part of bank credit gaining KD89 million ( ), though growth did slow slightly to 16 per cent year-on-year (y/y). The sector is expected to continue to see growth moderate in 2014, a trend seen since the middle of 2013, stated the report by the country's top lender National Bank of Kuwait (NBK).
Consistent healthy growth in this sector, however, has pushed its share of total bank credit up by two percentage points in the last 12 months to account for almost 30 per cent, it stated.
Meanwhile, NBK pointed out that the money supply continued to slow down as private deposits contracted on the month.
The monthly gain was a relatively modest KD51 million, less than a third of the KD180 million average monthly gain seen in 2013. Weakness came largely from the non-financial business sector which saw its third consecutive monthly drop in credit, it added.
According to NBK, the non-bank financials deleveraged further during the month following an unusual gain in December. Credit to the sector was down by another KD20 million in January, bringing the year-on-year decline to 12.8 per cent.
This trend is likely to continue in 2014, though at a slowing pace as the health of investment sector improves, it added.
The Kuwaiti lender said money supply (M2) growth slowed further to 7.8 per cent y/y with private deposits down by KD213 million. The decline in deposits was largely in KD time, down KD178 million.
KD sight and saving deposits were also lower. By contrast, foreign currency deposits saw a small increase. M1 growth eased to 10.3 per cent, the report added.-TradeArabia News Service