Stories By: Business Editor
MBABANE – Loans extended to businesses grew by 8.8 per cent last month to reach E18.6 billion in September 2023.
This was mentioned by the Central Bank of Eswatini (CBE) in their latest monthly statistical release for the month of September.
CBE said credit extended to the private sector contracted by 0.3 per cent when the month of September was compared to October (month-on-month) and grew by 8.8 per cent when compared to that of 2022 (year-on-year) to settle at E18.6 billion at the end of September 2023.
“Accounting for the month-on-month fall in private sector credit was credit to businesses. In contrast, credit to other sectors of the domestic economy and households & non-profit institutions serving households (NPISH) increased over the month under review,” added CBE.
The central bank further mentioned that preliminary gross official reserves amounted to E9.2 billion at the end of October 2023, higher by 20.9 per cent month-on-month and 12.2 per cent year on year.
CBE said the growth in reserves was mainly attributed to the quarterly inflow of Southern African Customs Union (SACU) receipts on the first week of October 2023.
“The reserves were enough to cover 2.9 months’ worth of imports of goods and services, higher than the 2.4 months covered in September 2023,” mentions CBE in the report.
The report further revealed that credit extended to other business sectors declined by 1.8 per cent from the previous month and grew by 9.8 per cent year-on-year to reach E9.2 billion at the end of September 2023.
CBE said the reduction was registered in credit to the following subsectors; distribution & tourism (-7.6 per cent), construction (-3.3 per cent), agriculture & forestry (-2.2 per cent) and transport & communications (-0.5 per cent). Growth was however, recorded in credit to the following subsectors; mining & quarrying (15.1 per cent), community, social & personal services (2.3 per cent), manufacturing (1.4 per cent) and real estate (1.1 per cent).
Net claims on government with the banking sector went up by 16.7 per cent month-on-month and 6.0 per cent year-on- year to settle at E3.3 billion at the end of September 2023. The central bank said the increase was observed in claims on government which grew by 4.9 per cent to E7.4 billion, due to an advance from the Central Bank.
Government deposits, however, fell by 3.2 per cent to close the month under review at E4.1 billion. Broad money supply (M2) registered a decline of 4.8 per cent month-on-month and growth of 1.8 per cent year-on-year to close the review month at E22.0 billion,” added CBE.
They said this development was in accordance with the decline in both net foreign assets and private sector credit over the review month. The month-on-month reduction in M2 was discernible in quasi money supply whereas narrow money supply (M1) increased.
Quasi money supply closed the review month at E13.3 billion, representing a fall of 9.4 per cent month-on-month and an increase of 5.4 per cent over the year. Accounting for the month-on-month decrease in quasi money were time deposits, which fell by 11.6 per cent to E11.2 billion at the end of September 2023. The central bank said savings deposits, on the contrary, improved by 4.4 per cent to E2.1 billion.
