The Central Bank of Oman released its seventh issue of the Financial Stability Report (FSR) on Thursday, 7th November 2019. According to the FSR 2019, improvement in oil prices and progress on economic diversification were the main catalysts of economic growth in the Sultanate. While acknowledging the challenges faced by the national economy and the need to continue to push for deeper reforms, the FSR notes that Sultanate is on the right track of further economic and fiscal reforms, and expresses satisfaction that financial stability in the Sultanate remained intact.
"The twin deficit has been considerably eased with both fiscal and current account deficits significantly declining in 2018. Merchandise trade surplus also reached its four-year high", the FSR states.
The FSR asserts, "the Omani banking sector remained robust with sound asset quality, and strong capital buffers. Banks posted reasonable profits that allowed organic growth, and strengthened capital buffers". Moreover, "the liquidity and solvency stress tests indicate that the financial institutions in Oman are resilient to any plausible challenges".
Drawing attention to a battery of measures taken in 2018 to fine-tune the regulations, the FSR stresses CBO's "capability, will, and resolve to take policy actions to help banks support the real sector growth and diversification efforts without compromising financial stability".
For more details please read the full text of the Financial Stability Report 2019, which is available on the Publications Section of our Website.
FSRs are an important communication tool of Central Banks used across the globe to disseminate information on potential points of distress in the domestic economy and the financial system. In Oman, publication of FSR was made a part of the overall macro-financial surveillance system since 2013.
Source: Central Bank of Oman