Public Sector Loans Propel Qatar Banks’ Credit Growth

Qatar’s banking sector experienced significant growth in loans, reaching QR1,428.2 billion in October 2025. This increase of 1.1 percent month-on-month (MoM) was primarily driven by the public sector, while private sector loans remained stable during the same period.

Despite a flat MoM growth in the banking sector’s loan book, a notable year-on-year increase of 6 percent was recorded compared to the end of 2024. According to data from QNB Financial Services (QNBFS), total deposits decreased by 0.9 percent MoM to QR1,041.7 billion but showed a rise of 1.5 percent against year-end 2024.

Loan to Deposit Ratio and Asset Overview

The loans to deposits ratio (LDR) rose from 135 percent in September 2025 to 137 percent in October 2025. Over the past five years, loans have grown at an average rate of 5.4 percent annually. The total assets within the banking sector saw a decrease of 1.1 percent MoM, amounting to QR2,126.5 billion. However, this figure represents a 3.9 percent increase compared to the end of financial year 2024.

Liquid assets remained robust, maintaining a healthy level at 30 percent as of October 2025. This stability is critical as banks continue to navigate economic conditions.

Public and Private Sector Contributions

Breaking down the loan data further, the government segment, which constitutes 36 percent of public sector loans, grew by 2.3 percent MoM and surged by 43.6 percent compared to the previous financial year. In contrast, the government institutions segment, representing 59 percent of total public sector loans, remained flat month-on-month but recorded a slight increase of 0.6 percent year-on-year.

The semi-government institutions segment, accounting for 4.5 percent of total public sector loans, showed minimal contribution with an increase of 5.2 percent MoM and 4.9 percent year-on-year.

On the deposit side, public sector deposits fell by 2.3 percent MoM, while private sector deposits decreased by 0.5 percent. In contrast, non-resident deposits saw a modest increase of 0.7 percent. Overall, public sector deposits contributed 35 percent to total deposits, with private sector deposits at 46.6 percent and non-resident deposits at 18.4 percent.

Loan provisions to gross loans remained steady at 4.2 percent in October 2025. This marks an increase from 2.4 percent in 2020 and 4 percent in 2023, as banks have been adjusting provisions for Stage 2 and Stage 3 loans, particularly from the contracting and real estate sectors.

These figures highlight the ongoing dynamics within Qatar’s banking sector, reflecting both challenges and opportunities as the economy continues to evolve.