Provisions against non performing loans for UAE banks rose 2.5 percent in January, central bank data showed on Tuesday, underscoring the ongoing tough credit environment for lenders in the region.
Bank provisioning against non performing loans increased to $9.1 billion, up 64 percent year on year.
General provisions rose 16 percent month on monbth to $3.37 billion.
UAE lenders have taken hefty provisions against bad loans in the wake of the global economic downturn and as asset quality deteriorates, especially in the real estate sector where local banks are heavily exposed.
The problems for UAE banks have been exacerbated by Dubai World, currently restructuring $22 billion in debt.
Ratings agency Moody's said on Monday it estimated the total exposure of UAE banks to the conglomerate to be about $15 billion.
The data also showed bank assets fell 0.8 percent and deposits by 1.5 percent to $263.5 billion in January month on month. (Reuters)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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