Gross assets of UAE banks hit Dhs3.8tn in April

The Central Bank of the UAE (CBUAE) said the gross assets of banks operating in the country rose by 1 per cent to Dhs3.80tn at the end of April compared to Dhs3.76tn a month earlier, according to state-run news agency WAM.

The central bank said UAE banks’ gross credit increased by 0.1 per cent to Dhs1.89tn in April, driven by a 0.4 per cent growth in domestic credit, overriding a 2.3 per cent plunge in foreign credit.

Domestic credit rose due to increases in credit to the public sector (government-related entities) and the private sector, respectively.

CBUAE said total bank deposits rose by 1.9 per cent to Dhs2.30tn in March to Dhs2.35tn in April, driven by a 2.1 per cent increase in resident deposits and 0.9 per cent growth in non-resident deposits.

The apex lender attributed the increase in resident deposits to 2.7 per cent, 9.3 per cent and 1.4 per cent growth in the government sector, public sector and private sector deposits, respectively. Meanwhile, non-banking financial institutions’ deposits plunged by 16.4 per cent during the same period under review.

The UAE central bank also said that the money supply aggregate M1 reached Dhs775.2bn in April, a 2.1 per cent increase from Dhs759.3bn a month earlier. This was due to Dhs3.3bn and Dhs12.6bn increase in currency in circulation outside banks and monetary deposits, respectively.

The money supply aggregate M2 jumped by 2 per cent to Dhs1.82tn in April from Dhs1.78tn in March. The central bank attributed the increase in M2 to an elevated M1, and an Dhs19.4bn rise in quasi-monetary deposits.

CBUAE said the money supply aggregate M3 also soared by 2.2 per cent to Dhs2.25tn in April, owing to the increase in M2 and a Dhs13.9bn rise in government deposits.

The monetary base in the country’s banking system reached Dhs601bn in April, a 5.6 per cent increase from Dhs569bn in March. The main drivers of this expansion of the monetary base were increases in currency issued, reserve accounts and monetary bills and Islamic certificates of deposit.

CBUAE’s record balance sheet

Meanwhile, the CBUAE’s balance sheet grew by 6.3 per cent month-on-month to reach Dhs632bn in April, marking the largest level ever in its history.

The central bank said that its balance sheet also increased by 24 per cent year-on-year (YoY) or the equivalent of Dhs121.8bn against Dhs509.8bn in the same period a year earlier.

The latest data shows that on the asset side, the CBUAE has Dhs266.5bn in cash and bank balances in April, along with reserved investments to the tune of Dhs203.9bn.

Similarly, a breakdown showed that deposits stood at Dhs128.99bn, loans and advances at Dhs4.1bn and other assets at Dhs28.1bn.

CBUAE’s current and deposit accounts were at Dhs271.4bn, monetary bills and Islamic certificates of deposit at Dhs202.2bn, currency notes and coins issued at Dhs133.12bn, capital and reserves at Dhs14.21bn. The bank’s other liabilities were at Dhs9.95bn.

Read: UAE Islamic banks’ Q1 2023 assets up 7.3%