Bank Muscat to auction $650m CDs

Bank Muscat will issue 250 million rials ($649.7 million) in certificates of deposit (CD) through an auction in a move supported by the nation's central bank to encourage saving, the bank said yesterday.

The auction – the first of its kind in Oman, where CD auctions are reserved for the central bank – will be open to local and foreign investors, Bank Muscat Chief Executive Abdulrazak Ali Issa said.

Issa said Oman consumers needed incentives to save and that they had incurred a high level of personal debt. "We want to alleviate the debt situation in Oman," he said.

On September 15, the bank will auction 20m rials in 1-, 3-, and 5-year certificates of deposit. The CDs will be issued on September 17. The auctions will be held monthly for one year, and the minimum bid size is 100,000 rials with no bid ceiling, the bank said.

Certificates of deposit are usually issued by the Oman central bank, not the private sector.

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