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KUWAIT CITY, July 7: Credit extended by the Kuwaiti banking sector continued to grow during the past month of May, raising all types of loans granted to all economic sectors to around 2.5 billion dinars in the first five months of 2022 reaching a new record level at 44.8 billion dinars at the end of last May, the Al-Anba daily reports. On a monthly basis, credit granted by Kuwaiti banks increased last May by 1.6 percent, with a value of 722 million dinars, compared to last April, which reached the closing credit level of 44.1 billion dinars. .
This increase coincides with the clear recovery of the Kuwaiti economy since the beginning of this year, supported by the rise in oil prices to record levels and the gradual improvement in the pace of consumer spending. The increase in consumer loans granted for the purchase of durable goods and automobiles continued for the fourth consecutive month, registering a monthly increase of 0.75%, with a value of 14 thousand dinars during last May, to reach 1.86 billion dinars, compared with 1.85 billion dinars last April.
While installment loans to Kuwaitis for the purpose of renovating or buying private homes increased by 1% last May to 14.99 billion dinars, up from 14.84 billion dinars at the end of last April, and recorded a strong annual growth of 13.9% compared to levels in May last year of 13.16 billion dinars.
In addition, credit growth was bolstered by increased growth in loans for the purchase of securities, with a monthly increase of 13.5% to register a level of 3,509 million dinars during last May, compared to 3,091 million dinars last April. and also registered an annual increase of 38.97% compared to its levels in May last year, amounting to 2,525 million dinars. The oil and gas sector saw a monthly increase of 1.14% to register the level of 2,293 million dinars during last May, compared to 2,267 million dinars during last April. While it registered an annual increase of 15.86% compared to the levels of May last year, which amounted to 1,979 million dinars. With the return of economic activity to before the Corona pandemic and the increase in Kuwait’s oil production according to the agreed quotas and the continued increase in oil prices, credit is expected to continue to receive further support during the next period, in addition to an increase in the growth of the non-oil economy of Kuwait at a strong rate.
Regarding the deposits of the banking sector, we find that they witnessed an increase during the month of May of 0.65%, reaching the level of 47 billion dinars, above the level of 46.69 billion dinars that was achieved during the month of April. This increase is due to the wise policy of the Central Bank of Kuwait to increase interest rates in conjunction with the decisions of the Federal Reserve in the past period. The government raised 77 million dinars from its deposits last May, bringing the total government deposits in the banking system to 7,178 million dinars, up 1.08% monthly from 7,101 at the end of April. past.
In annual terms, it increased by 1.22% compared to its levels in May last year, which amounted to 7,091 million dinars. Thus, the government has pumped 87 million dinars out of their balance sheets in one year. At the private sector level, deposits in Kuwaiti dinars increased by 0.56% monthly during the month of May, reaching 37,150 million dinars at the end of the month, after the private sector injected 210 million dinars of deposits in Kuwaiti dinars.
Private sector deposits in dinars increased annually, reaching 2,564 million dinars, compared to the levels of May last year, which amounted to 34,586 million dinars, at a rate of 7.41%. Central Bank data showed that Kuwait’s reserve assets rose to 15.04 billion dinars at the end of last May, growing 4.3% monthly from its level of 14.41 billion dinars last April.
The country’s reserves included about 13.39 billion dinars, the balance of foreign currency and deposits abroad, plus about 1.33 billion dinars Kuwait’s special drawing rights with the International Monetary Fund. It also consists of about 234.2 million dinars in balance with the International Monetary Fund. Kuwait’s foreign exchange reserve includes gold (amounting to 79 tons calculated at book value since its purchase) at about 31.7 million dinars at the end of May 2022, knowing that the foreign exchange reserve does not include the foreign assets of the General Investment Authority represented by the sovereign fund.