Sheikh Khalid al Mashani, chairman of Omani lender, BankMuscat has said the Sultanate's banking sector is set to witness intense competition and pressure on interest-rate margins with Islamic banking windows and two new banks preparing to launch this year, Muscat Daily has reported. "It is not going to be easy. We expect everyone to compete with the launch of Islamic banking. There will definitely be some pressure on interest-rate margins as all banks are eager to grow in this small yet competitive market." Interest rates are likely to remain at current levels in 2012 and any reduction in rates will depend on the level of competition in the market, he added.