Doha, Qatar: Qatar’s banking sector continued its steady performance in February 2025, with total assets rising by 1.1 percent month-on-month (MoM), reaching QR2.062 trillion, stated QNB Financial Services (QNBFS) in its latest report. On a year-to-date basis, total assets have grown by 0.7 percent, reflecting a solid start to the year for the financial sector.
The report noted that total deposits climbed by 1.6 percent MoM in February (up 2.9 percent YTD), outpacing loan growth of 0.5 percent MoM (up 2.4 percent YTD). As a result, the sector’s loan-to-deposit ratio (LDR) declined to 130.5 percent, down from 132 percent in January, indicating improved liquidity. Public sector deposits saw strong growth, rising 3.6 percent MoM (up 4.6 percent YTD), led by an 8 percent MoM increase in government deposits and a 4.8 percent MoM rise in deposits from government institutions. However, semi-government institution deposits declined 11.0% MoM despite a modest 2.6 percent gain for the year. Private sector deposits also trended positively, increasing by 1.1 percent MoM (up 2.6 percent YTD), with consumer deposits up 1.4 percent and corporate deposits rising by 0.8% during the month. In contrast, non-resident deposits dipped slightly by 0.6 percent MoM, though they have increased 0.7 percent YTD. As of February, non-resident deposits accounted for 19.1 percent of total deposits, up from 18.2 percent at the end of 2023—highlighting continued reliance on external funding.
On the other hand, loan growth in February was primarily driven by the public sector, with loans rising 1.4 percent MoM (up 6.8 percent YTD). Government borrowing surged by 4.4 percent MoM (up 18.3 percent YTD), while semi-government institutions and government institutions posted more modest gains.
The private sector loan book edged up by 0.2 percent MoM (up 0.8 percent YTD), supported by growth in the contracting segment (+2.5 percent) and real estate (+0.2 percent). Meanwhile, general trade loans declined slightly (-0.2 percent MoM), and consumption, services, and other sectors recorded marginal gains. Outside Qatar, loans increased by 0.2 percent MoM, showing a marginal growth of 0.02 percent for the year.
The report also mentions that loan provisions remained stable at 3.8 percent in February, consistent with January levels. Provisioning has steadily increased from 2.3 percent in 2019 to 3.9 percent in 2024, reflecting caution around Stage 2 and 3 loans—particularly in the contracting and real estate sectors. Additionally, liquidity also improved, with liquid assets to total assets rising to 30.4% in February, up from 30.2% in January, signaling a robust liquidity position for the sector.
