At the end of the third quarter of 2020 total assets of banks operating in the UAE increased by 2% (q-o-q), reaching AED3,252.5 billion, the Central Bank of the United Arab Emirates said today.
During the period between September 2019 and September 2020, the total assets of banks operating in the UAE increased by 7.6 pct (y-o-y). Gross credit also rose by 0.8 pct (q-o-q), reaching 1,804.6 billion at the end of September 2020. On an annual basis, gross credit increased by 4.9 pct, according to the apex bank’s Q3 report issued today.
The report discusses the monetary and banking activities as well as developments in the UAE financial markets during the third quarter of 2020. It also reviews ratios of annual change over the period from September 2019 to September 2020.
At the end of the third quarter of 2020, total deposits of resident and non-resident customers with banks operating in the UAE rose by 2.2 pct (q-o-q), reaching AED1,907.2 billion.
Resident deposits increased by 3 pct (q-o-q), reaching AED 1,715.9 billion at the end of the third quarter of 2020. Nonresident deposits fell by 4.5 pct (q-o-q), reaching AED191.3 billion by the end of September 2020.
On an annual basis, resident deposits increased by 6.4 pct and Non-resident deposits increased by 0.8%.
Money Supply M1, which comprises Currency in Circulation outside Banks (Currency Issued – Cash at banks) plus Monetary Deposits, increased by 1.9 pct (q-o-q) during the third quarter of 2020.
On an annual basis, there was an 11 pct (y-o-y) climb in the monetary aggregate M1, reaching AED 568 billion at the end of September 2020.
Money Supply M2 (M1 plus Quasi Monetary Deposits (Resident Time and Savings Deposits in Dirham, plus Resident Deposits in Foreign Currencies)), also increased by 0.7 pct (q-o-q) during the third quarter of 2020.
On an annual basis, there was a 7.9% (y-o-y) increase in Money Supply M2, reaching AED 1,468.7 billion at the end of third quarter of 2020.
Money Supply M3 (M2 plus government deposits at banks and at the Central Bank) rose by 3 pct (q-o-q) during the third quarter of 2020.
On an annual basis, there was a 7.5 pct (y-o-y) growth in Money Supply M3, reaching AED 1,805.7 billion at the end of September 2020.
Typically, the money supply M2, is considered the best indicator for the availability of liquidity in the economy, as it comprises currency in circulation outside banks, in addition to various deposits of all the resident sectors in dirham denomination, except for the deposits of the government sector in the UAE.
Statistical data show that at the end of the third quarter of 2020, there was a q-o-q increase in M2. The rise in M2 during the third quarter of 2020 was mainly due to a 0.5 pct quarterly increase in the non-government resident deposits standing at AED1,372 billion at the end of September 2020.
Also Read: UAE lauds Saudi Arabia ahead of G20 summit
Also Read: UAE extends grace period for visa violators