NBK: credit growth steady at 8.2% y/y

KUWAIT, Oct 15 (KUNA) -- Credit growth has been steady at 8.2% y/y even as July sees monthly decline, NBK economic report said Saturday.
The report said total credit declined by KD 116 million was largely due to a decrease in lending for the purchase of securities and the real estate sector.
Meanwhile, private deposits saw a large decrease during the month, some of which was offset by gains in government deposits. Domestic interest rates eased slightly in July, it added.
Growth in household lending remained relatively subdued in July, adding KD 55 million.
Growth moderated to 9.8% y/y, its slowest pace since December 2011, it pointed out.
Installment loans continued to largely support the expansion in credit, albeit at a reduced pace, with growth edging lower to 11.7% y/y.
Shorter-tenor consumer loans registered another small monthly decline and were down by 2.3% y/y. Nonbank financial companies saw a net decline in credit, but maintained positive growth compared to a year before.
Sector debt shrank by KD 62 million in July, though growth picked up to 3.9% y/y thanks to net gains in lending during recent months and an apparent end to a period of deleveraging in the sector since the financial crisis.
All remaining credit declined by KD 109 million, though growth held up at 7.6% y/y thanks to basis effects, the report noted. A large part of the July decline was from lending for the purchase of securities, which fell by KD 273 million; another KD 71 million drop came from lending to the real estate sector.
Most other sectors did relatively well, including oil & gas, construction, and trade, adding a combined KD 241 million.
Credit growth excluding lending for the purchase of securities and real estate picked up to 13.2% y/y. Private deposits saw a large drop in July. Their decline by KD 652 million pushed growth in broad M2 money supply down to 0.9% y/y; growth in narrower M1 money supply recorded a 2.2% y/y decline.
The largest decline came from KD sight deposits, down KD 451 million, though savings and foreign currency deposits were also lower.
Meanwhile, KD time deposits managed to increase by KD 68 million, recording the strongest growth of 9.2% y/y. (end) asj.nfm