UAE banks’ investments up 0.3% to Dhs666.2b

The total investments by banks operating in the country continued to rise steadily, reaching Dhs666.2 billion at the end of April 2024, registering growth of 0.3% on a monthly basis, and 5% since the beginning of the year, according to banks indicators Issued by the Central Bank of the UAE (CBUAE)..

The figures showed a 21% increase in investments at th end of April 2024 compared to the same month last year.

At te end of last April, the investments included debt securities at Dhs270.5 billion, equities at Dhs16.6 billion, held to maturity securities at Dhs328.5 billion, and other investments at Dhs50.6 billion.

The Central Bank of the United Arab Emirates  on Thursday announced that monetary deposits increased by over 1.74 per cent or Dhs13.1 billion in April, reaching Dhs764 billion, compared to Dhs750.9 billion in March.

According to CBUAE’s statistics for April, issued on Friday, government deposits increased to Dhs508.8 billion, while quasi-monetary deposits settled at Dhs1.256 trillion.

Currency issued reached Dhs146.8 billion during April, with banks accounting for Dhs18.4 billion and currency circulated outside banks logged at Dhs128.4.

The April statistics further showed that the monetary base expanded by 1.5 per cent to Dhs714.3 billion, comprising Dhs146.8 billion in currency issued, Dhs183.1 billion in reserve account, Dhs124.5 billion in banks and OFCs’ current accounts and Dhs259.9 billion in certificates of deposit and monetary bills.

According to the Monetary & Banking Developments issued by the Central Bank of the UAE on Thursday the gross banks’ assets, including bankers’ acceptances, increased by 1.0 per cent from Dhs4,254.5 billion at the end of March 2024 to Dhs4,296.5 billion at the end of April 2024,

Gross credit grew by 0.8 per cent from Dhs 2,047.0 billion at the end of March 2024 to Dhs2,063.1 billion at the end of April 2024. Gross credit growth was driven by the increase in domestic credit by 0.7 per cent and in foreign credit by 1.4 per cent. Domestic credit expansion was due to increase in credit to the government sector and private sector by 4.7 per cent and 0.4 percent respectively, offsetting the 0.5 per cent, and 3.8 per cent decrease in credit to the public sector (government-related entities) and non-banking financial institutions.

Aggregate bank deposits increased by 2.3 percent, from Dhs2,657.1 billion at the end of March 2024 to Dhs2,717.5 billion at the end of April 2024. The increase in total bank deposits was due to the growth in resident deposits by 2.7 per cent offsetting the decline in non-resident deposits by 2.9 per cent.

Resident deposits expanded as a result of the growth in government and private sector deposits by 13.0 per cent and 1.4 per cent respectively, offsetting the decline in government related entities deposits and non-banking financial institutions deposits by 0.5 per cent and 18.8 per cent, respectively at the end of April 2024.

The Central Bank announced that the money supply aggregate M1 increased by 1.6 percent, from Dhs878.1 billion at the end of March 2024 to Dhs892.4 billion at the end of April 2024. This was due to Dhs1.2 billion rise in currency in circulation outside banks, combined with Dhs13.1 billion increase in monetary deposits.

The money supply aggregate M2 increased by 0.6 per cent, from Dhs2,134.8 billion at the end of March 2024 to Dhs2,148.5 billion at the end of April 2024. M2 increased mainly due to an elevated M1, overriding the Dhs0.6 billion reduction in Quasi-Monetary Deposits.

The money supply aggregate M3 increased by 2.8 per cent, from Dhs2,583.7 billion at the end of March 2024 to Dhs2,657.3 billion at the end of April 2024. M3 increased mainly because of an amplified M2, combined with an increase of Dhs59.9 billion in government deposits.

The monetary base expanded by 1.5 per cent, from Dhs703.7 billion at the end of March 2024 to Dhs714.3 billion at the end of April 2024. The rise in monetary base was driven by the growth in banks & OFCs’ current accounts & overnight deposits of banks at CBUAE by 72.0 percent, overshadowing the decline in currency issued by 0.1 percent, reserve account by 16.9 percent and monetary bills & Islamic certificates of deposit by 1.6 percent.

 The foreign assets of the UAE Central Bank (CBUAE) increased by 2.55 percent during April, reaching Dhs750.29 billion at the end of the month, compared to Dhs731.62 billion at the end of March.

Thus, the CBUAE has added more than Dhs176 billion to its foreign assets within a year (from April 2023 to the end of April 2024).

WAM