Gross banks’ assets, including bankers’ acceptances, rose by 2.2 percent, from AED 3,668.2 billion at the end of January 2023 to AED 3,747.8 billion at the end of February 2023, according to the Central Bank of the UAE's Monetary & Banking Developments for February 2023.
Gross credit increased by 1.2 percent from AED 1,874.3 billion at the end of January 2023 to AED 1,896.9 billion at the end of February 2023. Gross credit grew due to 1.6 percent increase in domestic credit, overriding a 2.1 percent decline in foreign credit.
Domestic credit expanded because of 2.8 percent and 3.2 percent increase in credit to the private sector and the non-nanking financial institutions, correspondingly. Whereas, credit to the Government Sector and the Public Sector (Government Related Entities), decreased by 0.2 percent and 2.1 percent, respectively.
Total bank deposits increased by 0.4 percent, rising from AED 2,233.2 billion at the end of January 2023 to AED 2,242.3 billion at the end of February 2023. The growth in total bank deposits was due to increases in Resident Deposits by 0.2 percent and Non-resident deposits by 2.0 percent. Resident reposits improved owing to increases by 2.1 percent in both private sector and public sector (Government Related Entities) deposits. However, government sector deposits and non-banking financial institutions’ deposits fell by 5.9 percent and 8.7 percent, individually.
The Central Bank also announced that the money supply aggregate M1 increased by 1.3 percent, from AED 752.1 billion at the end of January 2023 to AED 762.0 billion at the end of February 2023. This was due to AED 0.5 billion and AED 9.4 billion growth in currency in circulation outside banks and in monetary deposits, respectively.
The money supply aggregate M2 climbed by 1.7 percent, from AED 1,719.9 billion at the end of January 2023 to AED 1,749.4 billion at the end of February 2023. M2 rose due to an increased M1 and a rise of AED 19.6 billion in quasi-monetary deposits.
The money supply aggregate M3 also climbed by 0.3 percent, from AED 2,124.0 billion at the end of January 2023 to AED 2,130.2 billion at the end of February 2023. M3 primarily increased because of an elevated M2, overshadowing the AED 23.3 billion fall in government deposits.
The monetary base expanded by 1.4 percent climbing from AED 536.4 billion at the end of January 2023 to AED 543.9 billion at the end of February 2023. The main drivers of this expansion of the monetary base were increases in currency issued and monetary bills & Islamic certificates of deposit by 0.5 percent and 8.3 percent, respectively. Reserve account and banks & OFCs’ current accounts and overnight deposits of banks at CBUAE fell by 1.1 percent and 4.0 percent, correspondingly.
News Source: Emirates News Agency
