Public And Government Deposits In Local Banks Increased 16.6% To 11.44 Billion Dinars In 12 Months

Recent data released by the Central Bank of Kuwait sheds light on the dynamic landscape of the country's banking sector. As of February, total deposits in local banks exhibited a steady growth rate of approximately 3.6% annually, soaring to around 49.07 billion dinars compared to 47.32 billion dinars in February 2023, indicating an increase of 1.74 billion dinars.

Private sector dominance in local bank deposits remains evident, with figures reaching 37.62 billion dinars by February 2024. This represents a noteworthy rise from the previous year, witnessing a surge of 114 million dinars compared to February 2023's deposits of approximately 37.512 billion dinars.

Diving deeper into deposit categories, demand deposits amounted to 8.9 billion dinars, experiencing a decline from February 2023's figures of around 10 billion dinars. Savings deposits, on the other hand, witnessed a dip to 5.76 billion dinars in February 2024, marking a decrease of 14.4% from the previous year's 6.73 billion dinars.

The Central Bank of Kuwait's adjustment of interest rates on dinar deposits impacted foreign currency deposits, which decreased to about 1.77 billion dinars by February's end, compared to 1.80 billion dinars in the corresponding period last year.

Government and public institution deposits surged significantly, escalating by 16.6% over 12 months to reach 11.44 billion dinars by February 2024. This remarkable increase, attributed to rising oil prices averaging $84.4 per barrel, enabled government agencies to bolster cash reserves, halting the practice of deposit monetization pursued by some entities in the previous period to tackle liquidity challenges.

Additionally, official reserve assets of the State of Kuwait witnessed a notable uptick, totaling approximately 14.8 billion dinars in February 2024, reflecting a 3.8% increase from January's reserves of about 14.2 billion dinars. It's important to note that these reserves exclude external assets of the General Investment Authority and consist solely of external assets controlled by monetary authorities, serving various purposes such as meeting financing needs in balance of payments and intervening in exchange markets to influence currency exchange rates.

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