The Central Bank of the UAE revealed that total banking assets, including bank acceptance certificates, rose to AED 4.31 trillion at the end of last June, an increase of 0.5% on a monthly basis, compared to about AED 4.28 trillion in May 2024.
The Central Bank added, in a report today, entitled “Monetary and Banking Developments for June 2024”, that total credit rose by 1.1% to 2.101 trillion dirhams at the end of June, compared to 2.078 trillion dirhams at the end of last May, as a result of an increase in domestic credit by 0.8% and an increase in foreign credit by 2.9%.
The Central Bank attributed the expansion in domestic credit to increases in credit to the public sector (government-related entities) and credit to the private sector by 1.4% and 1% respectively, offsetting the decline of 1.1% and 0.6% in credit to the government sector and non-banking financial institutions.
Total bank deposits rose by 0.5% to AED 2.692 trillion at the end of June, compared to AED 2.678 trillion at the end of May, driven by an 8.4% increase in non-resident deposits, outweighing a 0.1% decrease in resident deposits.
The Central Bank stated that resident deposits decreased as a result of a 3% decrease in government deposits and a 0.1% decrease in government-related deposits, while private sector deposits increased by 0.4% and non-banking financial institutions deposits increased by 6.6% at the end of last June.
Monetary base
The monetary base decreased by 0.3% from AED 727.1 billion at the end of May to AED 725 billion at the end of June, driven by a 2.3% decrease in issued currencies, a 42.2% decrease in current accounts of banks and other financial institutions and overnight deposits with the Central Bank, and a 0.5% increase in Islamic bills and certificates of deposit, while the reserve account recorded an increase of 37.3%.
The report explained that the total money supply “M1”, which includes cash in circulation outside banks + cash deposits (current accounts and demand accounts with banks), rose by 0.6% from AED 879.2 billion at the end of May to AED 884.1 billion at the end of last June, as a result of the increase in cash deposits by AED 7.3 billion, exceeding a decrease of AED 2.4 billion in the value of currency in circulation outside banks.
The report indicated that the total money supply “M2” – which includes “M1” + quasi-monetary deposits, time deposits, resident savings deposits in dirhams, and resident deposits in foreign currencies – increased by 0.5% by 0.4% to AED 2.169 trillion at the end of last June, as a result of the increase in money supply “M1” and an increase in quasi-monetary deposits by AED 4.2 billion.
Total money supply (M3) – which includes M2 + government deposits with banks operating in the country as well as with the Central Bank – increased by 0.1% to AED 2.632 trillion at the end of last June as a result of the growth in money supply (M2).
– Foreign assets
The total foreign assets of the Central Bank of the UAE exceeded the 770 billion dirham barrier by the end of last June, for the first time in its history, according to the bank’s latest statistics, as they increased on a monthly basis by 0.5% from 766.73 billion dirhams in May to 770.6 billion dirhams in June 2024, an increase equivalent to 3.88 billion dirhams.
The Central Bank’s foreign assets increased by 30% year-on-year, compared to about 592.11 billion dirhams in June 2023, an increase equivalent to about 178.5 billion dirhams in 12 months.
The Central Bank’s statistics attributed the increase in the volume of foreign assets to the increase in bank balances and deposits in banks abroad, to 533.86 billion dirhams, while foreign securities increased to 179.72 billion dirhams, and other foreign assets rose to more than 57 billion dirhams by the end of last June.
The Central Bank stated that its foreign assets do not include its reserve position and special drawing rights with the International Monetary Fund.
– Central Bank budget
The balance sheet of the Central Bank of the UAE reached AED 806.39 billion at the end of last June, an annual increase of 24.2% compared to about AED 649.4 billion in June 2023, an increase equivalent to AED 157 billion over 12 months.
According to statistics, the Central Bank’s budget was distributed on the assets side at AED 352.79 billion for cash and bank balances last June, in addition to investments at AED 206.43 billion, AED 208.78 billion for deposits, AED 1.71 billion for loans and advances, and AED 36.68 billion for other assets.
The balance sheet was distributed on the liabilities and capital side as follows: AED 396.72 billion for current accounts and deposit accounts, AED 226.93 billion for Islamic bills and certificates of deposit, AED 145.36 billion for issued banknotes and coins, AED 26.56 billion for capital and reserves, and AED 10.82 billion for other liabilities.
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