KUWAIT: In its monthly statistical bulletin for June 2022 as published on its website, the Central Bank of Kuwait (CBK) stated that the balance of total public debt instruments (including securities and bonds transactions since April 2016) has decreased by KD 450 million reaching KD 500 million by the end of June 2022 versus June 2021, that is 0.9 percent out of 2022 GDP estimated at KD 57.951 billion (EIU estimates), excluding foreign public debts.
The average interest rate (return) on public debt instruments for a one-year term was 2.750 percent, 3.250 percent for 2 years, 3.375 percent for three years, 3.625 percent for five years, 3.750 percent for seven years and 3.875 percent for 10 years. Local banks capture 100 percent of the total public debt instruments (100 percent at the end of June 2021). The CBK bulletin states that total credit facilities for residents offered by local banks by the end of June 2022 scored KD 44.679 billion, about 54.6 percent of total local banks’ assets, rising by KD 3.924 billion and indicating a growth rate of 9.6 percent over its level in June 2021.
Total personal facilities scored KD 20.502 billion or 45.9 percent out of total credit facilities (KD 17.951 billion in the end of June 2021) and increased by 14.2 percent. Based on our estimation, this is a deviation from the beneficial credit growth. Total value of installment loans was at KD 15.214 billion or 74.2 percent of the total value of personal facilities. Share of facilities provided for the purchase of securities scored KD 3.005 billion, 14.7 percent of total personal facilities. Value of consumer loans amounted to KD 1.896 billion. Credit facilities to the real estate sector amounted to KD 9.771 billion or 21.9 percent of the total (KD 9.307 billion at the end of June 2021).
This means that about two-thirds of the credit facilities went to personal and real estate facilities. Nearly KD 3.312 billion or 7.4 percent went to the trade sector (KD 3.196 billion at the end of June 2021), and KD 2.484 billion or 5.6 percent went to the industry sector (KD 2.200 billion at the end of June 2021), KD 1.959 billion or 4.4 percent went to the construction sector (KD 1.854 billion at the end of June 2021), and KD 975 million or 2.2 percent went to the non-bank financial institutions (KD 953 million at the end of June 2021).
The bulletin also indicates that total deposits at local banks stood at KD 47.108 billion, representing 57.6 percent of total local banks liabilities, rising by KD 2.955 billion compared to June 2021 at a growth rate of 6.7 percent, due to the rise in the public sector deposits by KD 316.7 million and the increase in the private sector deposits by KD 2.638 billion.
About KD 39.917 billion or 84.7 percent went the to the clients of the private sector in its comprehensive definition including major institutions like the – Public Institution for Social Securities- and does not include the government. About KD 37.272 billion was in Kuwaiti dinars, 93.4 percent went to private sector clients and the equivalent of KD 2.645 billion was in foreign currency to private sector clients.
As for the average interest rate on customer term deposits, both in the Kuwaiti dinar and the US dollar compared to the end of June 2021, the bulletin recalls that the difference in average interest rate is still in favor of the Kuwaiti dinar at the end of both periods. However, the difference decreased due to the increase in US interest rates which exceeded the increase in the discount rate on the Kuwaiti dinar.
The difference was at 0 .583 points for 1 -month deposits, 0 .383 points for 3 months, 0 .388 points for 6 – month deposits and 0 .419 points for 12 – month deposits. Conversely, the difference at the end of June 2021 was at 0 .733 points for 1 month deposits, 0 .809 points for 3 – month deposits, 0 .858 points for 6 -month deposits and 0 .896 points for 12 -month deposits. The monthly average exchange rate for the Kuwaiti dinar against the US dollar in June 2022 scored 306.240 Kuwaiti fils for each US dollar, a decline of – 1 . 8 percent compared with the monthly average for June 2021 when it scored 300.900 fils per one US dollar.