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11-04-23

UAE Banks' Assets, Deposits Continue to Increase, According to Central Bank Data

(MENAFN) The latest report from the Central Bank of UAE on Monetary Banking Developments for January 2023 has revealed that the value of UAE banks' assets, including acceptance certificates, has increased to 3.66 trillion dirhams ($996.6 billion). This is a significant 11.5 percent growth compared to 3.29 trillion dirhams recorded during the same period last year. Total bank credit has also increased 4.1 percent annually, or by 73.9 billion dirhams to 1.87 trillion dirhams, compared to roughly 1.8 trillion dirhams in January 2022.

The report also states that overall bank deposits climbed 19.2 percent year-on-year to 2.23 trillion dirhams at the end of January, an increase of 358.9 billion dirhams compared to 1.87 trillion dirhams in the same period last year. The CBUAE reported that bank deposits increased monthly by 0.5 percent compared to the 2.22 trillion dirhams at the end of last December. This increase was attributed to the growth in resident deposits, which increased by 0.8 percent due to a rise in government and private sector deposits of 1.7 percent and 1.3 percent.

The monetary base increased by 3.4 percent to 536.4 billion dirhams at the end of January 2023, from 518.7 billion dirhams at the end of last December. This includes the increases of 2.5 percent, 3.2 percent, 7.8 percent, and 0.6 percent in the issued currency, reserve account, current accounts, overnight deposits for banks and other financial institutions in the central bank, cash notes, and Islamic certificates of deposit. The money supply aggregate M1 rose by 2 percent, from 737.4 billion dirhams at the end of December 2022 to 752.1 billion dirhams at the end of January 2023, according to a statement from the central bank.

In January of last year, the report attributed this to a rise of 5 billion dirhams and 9.7 billion dirhams growth, in monetary deposits and currency in circulation outside of banks. Furthermore, the money supply aggregate M2 increased by 1 percent from the end of December 2022 to the end of January 2023, to 1.72 trillion dirhams. M2 grew as M1 climbed, and Quasi-Monetary Deposits increased by 2.2 billion dirhams.

The continued increase in the value of UAE banks' assets and deposits is a positive sign for the country's economy. The rise in resident deposits, including government and private sector deposits, has contributed to the growth in bank deposits. The increase in the monetary base and money supply aggregate M1 and M2 shows that there is a healthy flow of money within the economy. These factors demonstrate that UAE's banking sector is thriving and could potentially attract more investors in the future.
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