Gross banks’ assets, including bankers’ acceptances, rose by 0.2%, from AED3,442.7 billion at the end of May 2022 to AED3,449.2 billion at the end of June 2022, according to the Central Bank of the United Arab Emirates (CBUAE).
In its report on the monetary and banking developments in June 2022, the apex bank said that gross credit grew by 0.03% rising from AED1,865.5 billion at the end of May 2022 to AED1,866.1 billion at the end of June 2022. Gross Credit rose due to 5.6% increase in Foreign Credit, overriding the 0.6% reduction in Domestic Credit. Domestic Credit fell mainly due to 0.3%, 1.2% and 20.8% decline in credit to Public Sector (Government Related Entities), Private Sector and Non‐ Banking Financial Institutions, respectively. Credit to the Government Sector increased by 4.0%.
Total bank deposits increased by 2.5%, climbing from AED2,040.5 billion at the end of May 2022 to AED 2,091.9 billion at the end of June 2022. The growth in total bank deposits was due to the rise in resident deposits by 2.6% and non-resident deposits by 2.0%. Resident deposits increased owing to 3.9% and 22.6% expansions in private sector deposits and non-banking financial institutions deposits, respectively.
On the other hand, government sector deposits and public sector deposits diminished by 1.4% and 2.3%, correspondingly.
In the meantime, the monetary base contracted by 1.5% falling from AED 478.0 billion at the end of May 2022 to AED470.7 billion at the end of June 2022, according to the report.
The main drivers of this tightening in the monetary base were reductions in reserve account, banks & OFCs’ current accounts and overnight deposits of banks at CBUAE and certificates of deposit & monetary bills by 0.5%, 1.7% and 4.6 %, respectively. Whereas, currency Issued increased by 1.7%.
The CBUAE also announced that the Money Supply aggregate M1 increased by 2.3%, from AED710.1 billion at the end of May 2022 to AED726.2 billion at the end of June 2022. The Money Supply aggregate M2 grew by 3.5%, from AED 1,568.1 billion at the end of May 2022 to AED1,622.2 billion at the end of June 2022. The Money Supply aggregate M3 also rose by 2.6%, from AED 1,890.2 billion at the end of May 2022 to AED 1,939.9 billion at the end of June 2022.
M1 means the currency in circulation outside Banks + Monetary Deposits (current accounts and call accounts at banks); M2 refers to M1 + Quasi-monetary Deposits (resident time and saving deposits in Dirhams and resident deposits in foreign currencies) and M3 includes M2 + Government Deposits at banks operating in the UAE as well as at the Central Bank.
News Source: Emirates News Agency
