UAE Banks’ Gross Credit Rises 0.5% To $575B In August On Higher Domestic Credit To Private Sector
The UAE banking sector’s total loans increased by 0.5% in August 2024, reaching $575.3 billion (AED 2.11 trillion). This growth was mainly due to more loans given to private businesses within the country, according to official data released on Wednesday.
Private Sector Credit
- In August, loans to the private sector grew by 0.8% compared to the previous month, making up for decreases in loans to the public sector (down 0.3%) and non-banking financial institutions (down 3%), according to the Central Bank of the UAE (CBUAE).
- Overall, UAE banks increased their domestic loans by 0.5% in August, while loans given abroad went up by 0.8% compared to July.
- Deposits in UAE banks saw a small rise of 0.2%, reaching $746.1 billion (AED 2.740 trillion) in August, up from $744.9 billion (AED 2.736 trillion) in July. This growth was mainly due to higher deposits from the government, private sector, and non-banking financial institutions.
Big Number
The total assets of UAE banks, including loans and financial agreements, grew by 0.7% from the previous month to reach $1.2 trillion (AED 4.4 trillion) by the end of August.
Money Supply
The UAE’s narrow money supply (M1), which includes currency in circulation and savings deposits, dropped slightly by 0.1% to $241.8 billion (AED 888 billion) in August, compared to $242.8 billion (AED 889.1 billion) in July. This small decrease was mainly due to a drop of $245 million (AED 900 million) in currency outside the banks and a $108.9 million (AED 400 million) fall in monetary deposits.
The broader M2 money supply, which includes M1 plus other deposits, increased slightly by 0.2% to nearly $602 billion (AED 2.211 trillion) by the end of August, from $600.6 billion (AED 2.206 trillion) the month before.
The total money supply (M3), which includes M2 plus government deposits with UAE banks and the central bank, grew by 0.8% to $734.1 billion (AED 2.696 trillion) due to an increase in government deposits.
Economic growth
The CBUAE increased its economic growth prediction for the country to 4% in September, up from 3.9%, because the oil sector performed better.
Published: 5th December 2024
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