Deposits outvalued loans at UAE-based banks by AED85 billion ($23.1 billion) during the first 11 months of 2018, according to figures released by the Central Bank of the UAE.
The eligible liquid assets ratio rose by the end of November to 17 percent from 16.5 percent in October with the capital adequacy ratio up to 18.2 percent, a significant growth that reflects the UAE banking sector's robust solvency position, state news agency WAM reported.
The continued rise in interest rates over the past period drove demand for deposits, being a safe investment vehicle to earn respectable returns, it added.
According to the CBUAE figures, aggregate deposits at UAE-based banks surged to about AED1.739 trillion by the end of November, up by AED112 billion compared to the end of December 2017.
The growth was driven by an increase in residents' deposits to about AED1.535 trillion compared to AED1.435 trillion at end of December 2017.
In addition, government deposits jumped from AED212 billion to AED303.5 billion during the same period, WAM said.
On the credit side, total loans hit AED1.653 trillion in November compared to AED1.58 trillion at the end of December 2017.
The gap between loans and deposits started to narrow during the first half of 2017, before liquidity started to rebound by the end of Q3 of the same year, which caused deposits to outvalue loans again, WAM added.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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