According to the Central Bank of the UAE’s Monetary & Banking Developments for February 2023, there was a 2.2 percent increase in gross banks’ assets, including bankers’ acceptances. The total assets rose from AED 3,668.2B at the end of January 2023 to AED 3,747.8B at the end of February 2023.
During the same period, gross credit also experienced a 1.2 percent growth, reaching AED 1,896.9B by the end of February 2023. This increase was primarily driven by a 1.6 percent rise in domestic credit, which outweighed a 2.1 percent decline in foreign credit.
The expansion in domestic credit was primarily attributed to a 2.8 percent increase in credit to the private sector and a 3.2 percent increase in credit to non-banking financial institutions. However, credit to the Government Sector and the Public Sector (Government Related Entities) decreased by 0.2 percent and 2.1 percent, respectively.
According to the Central Bank of the UAE’s Monetary & Banking Developments for February 2023, total bank deposits experienced a 0.4 percent increase. The deposits rose from AED 2,233.2 billion at the end of January 2023 to AED 2,242.3B at the end of February 2023. This growth in deposits was driven by a 0.2 percent increase in Resident Deposits and a 2.0 percent increase in Non-resident deposits, according to WAM.
The improvement in Resident Deposits can be attributed to a 2.1 percent increase in both private sector and public sector (Government Related Entities) deposits. However, government sector deposits and non-banking financial institutions’ deposits declined by 5.9 percent and 8.7 percent, respectively.
Additionally, the Central Bank reported that the money supply aggregate M1 increased by 1.3 percent. It rose from AED 752.1 billion at the end of January 2023 to AED 762.0B at the end of February 2023. This increase was driven by a growth of AED 0.5B in currency in circulation outside banks and AED 9.4B in monetary deposits.
Moreover, the money supply aggregate M2 climbed by 1.7 percent, reaching AED 1,749.4B at the end of February 2023. This increase was a result of the rise in M1 and growth of AED 19.6B in quasi-monetary deposits.
According to the Central Bank of the UAE’s Monetary & Banking Developments for February 2023, the money supply aggregate M3 increased by 0.3 percent. It rose from AED 2,124.0B at the end of January 2023 to AED 2,130.2B at the end of February 2023. The primary driver of this increase was the elevated M2, which overshadowed the AED 23.3B decline in government deposits.
The monetary base also expanded by 1.4 percent, reaching AED 543.9B at the end of February 2023. This growth was mainly driven by a 0.5 percent increase in currency issued and an 8.3 percent increase in monetary bills & Islamic certificates of deposit. However, there was a 1.1 percent decrease in reserve accounts and a 4.0 percent decrease in banks & OFCs’ current accounts and overnight deposits of banks at CBUAE.
