UAE bank deposits rise 1.5%

Lending and total bank assets declined 0.3% to AED1.071bn, WAM said
UAE bank deposits rise 1.5%
Total money supply in the UAE, including currency in circulation plus deposits, slid 0.2 percent to AED264.1bn. (Getty Images)
By Shane McGinley
Tue 06 Mar 2012 12:03 PM

Total bank deposits in the UAE increased 1.5 percent during December 2011 to around AED1.069bn (US$291m), while total bank loans fell slightly, according to figures from the UAE Central Bank.

Total bank loans and advances decreased 0.3 percent to AED1.071bn and total bank assets fell 0.6 percent to AED1.662bn at the end of December, official news agency WAM reported.

Total money supply in the UAE, including currency in circulation plus deposits, slid 0.2 percent to AED264.1bn, the figures added.

Despite the drop in borrowing levels, UAE bank lending, which expanded at the fastest pace in three years in 2011, may grow at a similar pace in 2012 as banks extend credit to retail customers and small-and medium-sized companies, Bloomberg forecast earlier this year.

Total lending of the 51 local and foreign lenders operating in the second-largest Arab economy rose 4.2 percent to AED1.07 trillion ($291bn) in the first 11 months of last year, central bank data showed. After jumping more than 30 percent a year between 2005 and 2008, credit growth at UAE banks dropped to 1.3 percent in 2010.

UAE bank lending may grow this year in the “low single digits, similar to 2011,” Timucin Engin, a Dubai-based associate director at Standard & Poor’s, said by telephone. “Whatever lending growth there will be, will be generated predominantly by the Abu Dhabi-based banks.”

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