Credit demand eased slightly but seems to have stabilised, says UAE central bank

Survey respondents reported a tightening in credit standards last quarter, particularly in collateralisation requirements and premiums charged on riskier loans
Credit demand eased slightly but seems to have stabilised, says UAE central bank
Total demand for business and personal loans in the United Arab Emirates eased slightly in the October-December quarter (Getty Images)
By Reuters
Mon 30 Jan 2017 09:37 AM

Total demand for business and personal loans in the United Arab Emirates eased slightly in the October-December quarter but demand now seems to have stabilised, reflecting higher oil prices, a central bank survey showed on Sunday.

The net balance measure for business lending - the weighted percentage of respondents reporting an increase in demand for loans minus those reporting a fall in demand - was minus 1.3 in the last quarter, against minus 2.3 for the September quarter.

For the current quarter, respondents expected the net balance measure to rise to plus 20. This suggests a downward trend in overall credit demand since the first quarter of 2016 has ended, the central bank said.

Survey respondents reported a tightening in credit standards last quarter, particularly in collateralisation requirements and premiums charged on riskier loans. Credit standards are expected to continue tightening this quarter but to a lesser extent.

International oil prices are hovering around $55 a barrel, up from last year's average of about $45.

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