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Financial Stability Report 2015https://authoring.bnet.om/english/Reports/Pages/Financial-Stability-Report-2015.aspx5/14/2015 8:00:00 PMFinancial Stability Report 2015<p>The Central Bank of Oman released its 'May 2015 Issue' of the Financial Stability Report which indicated that the Macro Financial Scenario of Oman at least in the short run, was comfortable in 2014. </p><p> Likewise a series of CBO stress tests also indicated that the banking sector was also well placed in Oman, and that there were no imminent problems or threats to the sector. </p><p> Dr. Qais Al Yehyei, Head of the Financial Stability Department at CBO indicated that despite continued fall in oil prices creating pressures on the fiscal space, growth outlook through public investment has not looked back. </p><p> "There is a temporary set-back, though," Dr. Qais added. </p><p> Although the IMF–World Economic Outlook projected decrease in GDP growth rate in Oman from 4.7 per cent in 2013 to 2.95 per cent in 2014, the FSR indicated that there are positive indicators of better economic growth prospects and accordingly Oman's output growth is projected to be 4.62 per cent in 2015. </p><p> However, the report expressed concerns that if the effects of interest rate rise on account of QE policy reversal in the US, and the current state of reduced oil prices continue to remain the same, it could impact Oman's growth scenario adversely, al beit with a time lag. </p><p> Some of the salient features of the FSR reveal that non-oil sector continues to carry a rising share reflecting purposeful diversification. Inflation is benign. Risks in the external sector are manageable. Foreign exchange reserves are adequate enough. Banks are in good health – with a capital base of about 16 per cent of total risk-weighted assets, return on assets and return on equity steady at 2.2 per cent and 14.7 per cent, respectively. Net interest margin of banks averaged 3.7 per cent with net non-performing loans staying put at 0.5 percent of the total loans portfolio. Stress Tests results speak a similar story. <br></p>FinancialStabilityhttps://publishing.bnet.om/sites/assets/Documents/English/Publications/FSR/FinacialStabilityReport2015.pdf

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