DUBAI, Dec 21 (Reuters) - An outflow of foreign deposits from Qatari banks slowed further in November as the impact of an economic boycott imposed by other Arab states continued to diminish, data from Qatar’s central bank showed on Thursday.
Banks and investors from Saudi Arabia, the United Arab Emirates, Bahrain and Egypt began pulling deposits and other funds out of Qatar in June, when those four countries cut diplomatic and trade ties with Doha.
But in November, foreign customers’ deposits at banks in Qatar fell by just 2.8 billion riyals ($763 million) from the previous month to 134.9 billion riyals, the data showed.
That was the smallest decline since the dispute erupted and compared to a drop of 5.1 billion riyals in October; in June, deposits shrank by 14 billion riyals. Bankers say the vast majority of the four countries’ deposits in Qatar has now been pulled out, leaving little money left to withdraw.
The data also showed the Qatari public sector boosted its deposits in local banks by 9.9 billion riyals in November to 308.3 billion riyals. The Qatari government has been pumping money into deposits to protect local banks.
Meanwhile, Qatari banks owed banks outside the country 176.7 billion riyals in November, up from 171.7 billion riyals in October.
In the initial months of the diplomatic dispute, Qatari banks’ borrowing from foreign banks fell sharply as institutions from the four Arab countries stopped extending loans. November’s data suggested Qatari banks are starting to succeed in filling this gap by increasing their borrowing from Asia and Europe. (Reporting by Andrew Torchia; editing by Mark Heinrich)