Kd 2.5 Billion Loans Granted In 5 Months; Kuwaiti Economy On The Rise

Kuwait's banking sector continued to extend credit to all sectors during May, reaching a record level of 44.8 billion dinars at the end of May, according to Al- Anba daily. Total credit lent to all sectors reached 2.5 billion dinars in the first five months of 2022. Kuwaiti banks granted credit worth 722 million dinars during last May, which was 1.6 percent more than the amount granted in April, which reached 44.1 billion dinars at the end of the month.

With rising oil prices and a gradual improvement in consumer spending, Kuwait's economy has been clearly recovering since the beginning of this year. The number of loans granted to buy durable goods and cars rose for the fourth consecutive month in May, growing by 0.75%, representing 14 thousand dinars in value, to reach 1.86 billion dinars, compared to 1.85 billion dinars in April.

As of May last year, Kuwaitis received 14.99 billion dinars in installment loans to renovate or purchase private housing, compared to 14.84 billion dinars in April, representing a 13.9% increase over May last year.

A monthly increase of 13.5% was recorded in May of last year to reach 3.509 billion dinars, compared to 3.091 billion dinars in April, and an annual increase of 38.97% was recorded compared to 2.525 billion dinars in May of last year. As compared with April, the oil and gas sector achieved 2.293 billion dinars during last May, an increase of 1.14%. The level of 1.979 billion dinars recorded in May of last year was 15.86% higher than the level in May of this year. During the future period, as Kuwait's oil production increases according to agreed quotas and oil prices continue to rise, credit will receive more support and the country's non-oil economy will grow at a rapid pace in addition to the return of economic activity to the pre-Corona period.

As we turn to the deposits of the banking sector, we find that they increased by 0.65% in May, reaching 47 billion dinars from 46.69 billion dinars in April. Combined with the Federal Reserve's decisions in the past period, Kuwait's Central Bank has had wise policy of raising interest rates. Government deposits in the banking system rose by 77 million dinars in May, to 7.178 billion dinars, an increase of 1.08% over last April's 7.101 billion dinars.

Compared to May last year, when it reached 7.091 billion dinars, it rose by 1.22% on an annual basis. Approximately 87 million dinars have been sucked out of the government's account within the past year. A total of 37.150 billion dinars was deposited into Kuwaiti dinars in May by the private sector, after it pumped 210 million dinars of deposits into the dinars.

Compared to May last year, which amounted to 34.586 billion dinars, the private sector's deposits in dinars increased annually by 2.564 billion dinars to 2.564 billion dinars, a rate of 7.41%. In May, Kuwait's reserve assets were 15.04 billion dinars, up 4.3% from 14.41 billion dinars last April, according to Central Bank data.

Around 13.39 billion dinars were in Kuwait's reserves, along with deposits abroad and the IMF's special drawing rights of 1.33 billion dinars. Approximately 234.2 million dinars are also in balance with the International Monetary Fund. By the end of May 2022, Kuwait's foreign reserve will include gold (amounting to 79 tons calculated at book value since its purchase) worth 31.7 million dinars, while the foreign reserve does not include the foreign assets represented by the sovereign fund of the General Investment Authority.

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