The gross banks’ assets, including bankers’ acceptances, increased by 0.8 percent, from AED 4,075.2 billion at the end of December 2023 to AED 4,109.1 billion at the end of January 2024, according to the Central Bank of the UAE (CBUAE).
The bank in its monetary and banking developments for January 2024 reported that gross credit grew by 0.2 percent from AED 1,991.7 billion at the end of December 2023 to AED 1,996.2 billion at the end of January 2024.
CBUAE reported that the gross credit rose due to an increase in foreign credit by 1.9 percent, overshadowing a lessening of domestic credit by 0.01 percent. Domestic credit diminished because of 0.1 percent, 1.3 percent and 13.6 percent contraction in credit to the government sector, the public sector (government related entities) and the non-banking financial institutions, respectively. On the other hand, credit to the private sector increased by 0.5 percent, during January 2024.
Total bank deposits climbed by 0.7 percent, increasing from AED 2,521.9 billion at the end of December 2023 to AED 2,539.9 billion at the end of January 2024. The rise in total bank deposits was due to the growth in resident deposits by 0.9%, superseding the decrease in non-resident deposits by 1.8 percent.
Resident deposits expanded owing to increases in government sector deposits by 4.7 percent, in public sector (government related entities) deposits by 1.0 percent and in private sector deposits by 1.0 percent. However, non-banking financial institutions deposits fell by 24.9 percent.
The monetary base expanded by 1.8 percent, from AED 658.8 billion at the end of December 2023 to AED 670.9 billion at the end of January 2024. The main driver of this increase in the monetary base was the rise in monetary bills & Islamic certificates of deposit by 12.8%, overriding the reductions in currency issued by 0.4 percent, in reserve account by 1.4% and in banks & OFCs’ current accounts & overnight deposits of banks at CBUAE by 9.5 percent.
The money supply aggregate M1 increased by 0.1 percent, from AED 829.3 billion at the end of December 2023 to AED 830.0 billion at the end of January 2024. This was due to AED 0.9 billion rise in currency in circulation outside banks, overshadowing AED 0.2 billion fall in monetary deposits.
The money supply aggregate M2 increased by 0.2 percent, from AED 2,023.4 billion at the end of December 2023 to AED 2,028.3 billion at the end of January 2024. M2 increased due to an increased M1 and AED 4.2 billion rise in quasi-monetary deposits.
The money supply aggregate M3 also increased by 1.3percent, from AED 2,445.2 billion at the end of December 2023 to AED 2,478.0 billion at the end of January 2024. M3 increased because of an augmented M2 and AED 27.9 billion rise in government deposits.
WAM