Rising demand for bank credit ‘shows recovery’: Bahrain


Loans and credit facilities increased by 5.7% in Bahrain to BD 11.3 billion ($30.05 billion) at the end of May 2022 compared to the level at the end of May 2021 signaling an increase in economic activity, it emerged.

The business sector accounted for 46.2 pc of total outstanding loans, while the share of personal loans was 49.5 pc.

A statement from the Central Bank of Bahrain (CBB), after its board meeting yesterday, said the key indicators are consistent with the return of activity in all economic sectors in the kingdom and demonstrate the stability and the ability of the financial sector to serve the national economy. .

The data showed stable liquidity, broad money supply, M3, totaling BD 15.1 billion at the end of May 2022, an increase of 2.9% from the end of May 2021.

As for retail banks, total private deposits increased to about BD 13 billion at the end of last month, an increase of 1.4 percent over the same period last year.

The balance sheet of the banking system (retail banks and banks in the wholesale sector) increased to $220.7 billion at the end of May 2022, an increase of 3.7% compared to the level at the end of May 2021.

Point-of-sale (POS) data shows an increase in the number of transactions in the first five months of 2022, totaling 63.6 million (of which 73.1% contactless), or 40.4% more compared to the same period in 2021.

The total value of POS transactions in Bahrain during the period totaled BD 1.5 billion (of which 45.4% contactless), an increase of 32.7% compared to the same period in 2021.

The banking sector maintained a high level of liquidity, with the banking sector’s capital adequacy ratio standing at 19.5 pc in the first quarter of 2022 compared to 18.5 pc in the first quarter of 2021.

The capital adequacy ratio for the different banking sectors in the first quarter of 2022 was 21.3% for conventional retail banks, 17.8% for conventional wholesale banks, 21.3% for retail banks Islamic banks and 16.4% for Islamic wholesale banks.

The second meeting of the regulator’s board of directors for the current year was chaired by Hassan Al Jalahma and saw a review of the CBB’s performance report and developments in the financial sector for the second quarter of 2022 and the report of the CBB’s financial performance at the end of May 2022.

The board also reviewed the ongoing work on the financial services sector development strategy (2022-2026).

The members expressed their thanks and appreciation to the leaders of the kingdom for their support to the CBB and the efforts and measures taken to contain the repercussions of the Covid-19, including the Economic Recovery Plan which contributed to the return of normal activities to all sectors of the economy.

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