IMF April 2015 outlook states interesting falls and rises in numbers
Due to an increase in the loans taken by the private sectors, it has been said that there has been a near 3% lending growth for banks in the UAE during January to April this year. The deposit growth has been incremented to about the same amount.
Certain saving accounts were reported to face a 10% drop, although demand deposits quickened to about 9% quite easily. These demand deposits stem from individuals and businesses, while on the other hand, the government is responsible for the time and savings deposits.
IMF April 2015 states that the Saudi GDP has increased to 3% this year, being $752 billion from the $649 billion since last year’s oil price reduction. This reduction affected time and savings deposits the most, with banking and private sectors reaching close to and above 11% in 2014, respectively. Similarly, at the same time, the government sector was above 7% in terms of growth, and the public sectors of non-financial enterprises faced a growth of almost 4%.
The results can be summed up to the fact that in the first four months of 2015, the UAE’s banking sectors and their lending growth have gone above 3%, with an influx of demand growth of credit and stricter corporate credit standards. Other sectors, such as property development, construction loans, and transport sectors have been reduced due to this effect.
The deposit growth showed above 1% rise during the same period of time. IMF April 2015 further stated that despite all the positive developments, the current price of GDP became $364 billion where it was $402 billion before. The decreasing revenue of oil has further reduced bank deposit growth, while hitting credit growth in itself. These facts were represented statistically, as it was shown that the UAE’s lending growth was above 8%, while the deposit growth was above 11%.
Oman has shown similar developments and that is a noteworthy achievement. With nearly 4% growth in lending money to banking sectors, the deposit growth has risen about 3%. Due to the government’s quirky decisions regarding the development funds and a newly increased consumer credit market, the lending growth has been effectively halted.
Once again, IMF April 2015 outlook talked about Oman’s GDP growth as well, pointing out how it has decreased to 4.6% as opposed to a previous rise. In terms of money, the GDP reached $63 billion from $77 billion. Both the lending and deposit growth reached nearly 11% last year, showing that this year is not so lucky for Oman’s GDP or its other sectors.