CBUAE says gross banks’ assets reached Dhs3.74tn in February

The Central Bank of the UAE (CBUAE) said gross banks’ assets, including bankers’ acceptances, increased by 2.2 per cent, from Dhs3.66tn at the end of January 2023 to Dhs3.74tn at the end of February.

The latest data from CBUAE shows that gross credit surged by 1.2 per cent to Dhs1.89tn at the end of February from 1.87tn a month earlier, driven by a 1.6 per cent increase in domestic credit, overriding a 2.1 per cent decline in foreign credit.

The central bank said domestic credit expanded due to a 2.8 per cent and 3.2 per cent increase in credit to the private sector and the non-banking financial institutions, respectively. Similarly, credit to the government sector and the public sector – government-related entities (GRE), plunged by 0.2 per cent and 2.1 per cent, respectively.

Total bank deposits increased by 0.4 per cent to 2,24tn at the end of February from Dhs2.23tn in January 2023. The growth in total bank deposits was due to increases in resident deposits by 0.2 per cent and non-resident deposits by 2 per cent. Resident reposits improved owing to increases of 2.1 per cent in both the private sector and public sector (GRE) deposits. However, government sector deposits and non-banking financial institutions’ deposits dropped by 5.9 per cent and 8.7 per cent, respectively.

Central bank money supply

CBUAE also said the money supply aggregate M1 increased by 1.3 per cent from Dhs752.1bn in January to Dhs762bn at the end of February 2023. This was due to Dhs0.5bn and Dhs9.4bn growth in currency in circulation outside banks and in monetary deposits, respectively.

The money supply aggregate M2 climbed by 1.7 per cent to Dhs1.75tn at the end of February compared to Dhs1.72tn a month earlier. M2 rose due to an increased M1 and an increase in quasi-monetary deposits by Dhs19.6bn.

The money supply aggregate M3 also jumped 0.3 per cent to Dhs2.13tn in February 2023 from Dhs2.12tn at the end of January. M3 primarily increased because of an elevated M2, overshadowing the Dhs23.3bn decrease in government deposits.

The monetary base expanded by 1.4 per cent climbing to Dhs544bn at the end of February 2023 from Dhs536bn at the end of January.

The main drivers of this expansion of the monetary base were increases in the currency issued and monetary bills & Islamic certificates of deposit by 0.5 per cent and 8.3 per cent, respectively.

The central bank noted that reserve accounts and banks & OFCs’ current accounts and overnight deposits of banks at the apex lender fell by 1.1 per cent and 4 per cent, correspondingly.

UAE bank investments 

Meanwhile, the central bank said the total investments of banks operating in the country reached Dhs528bn at the end of December 2022.

This represents an 11.5 per cent annual increase or Dhs54.5bn compared to the same period in the previous year when the total investments were Dhs473.2bn, reported the state news agency, WAM.

Read: UAE banks’ total investments hit Dhs528bn in 2022