The Central Bank of the UAE (CBUAE) recently disclosed that gross banks' assets, inclusive of bankers' acceptances, rose by 0.7% from Dh4,348.6 billion at the close of July 2024 to Dh4,378.0 billion by the end of August 2024.
In its August 2024 Monetary and Banking Developments report, the CBUAE noted that gross credit expanded by 0.5% from Dh2.102 trillion at the end of July 2024 to Dh2.112 trillion by the end of August 2024. This growth was driven by a 0.5% increase in domestic credit and a 0.8% rise in foreign credit. The expansion in domestic credit was primarily due to a 0.8% increase in credit to the private sector, offsetting reductions in credit to the public sector (government related entities) by 0.3% and non-banking financial institutions by 3.0%. Credit to the government sector remained unchanged in August 2024.
Bank deposits saw a 0.2% increase, rising from Dh2.736 trillion at the end of July 2024 to Dh2.74 trillion by the end of August 2024. This growth was attributed to a 0.8% rise in resident deposits, which outweighed a 6.4% decline in non-resident deposits. Resident deposits grew due to increases in government sector deposits by 2.6%, private sector deposits by 1.2%, and non-banking financial institutions deposits by 4.2%, countering a 5.9% decrease in government related entities deposits.
The money supply aggregate M1 decreased by 0.1%, falling from Dh889.3 billion at the end of July 2024 to Dh888.0 billion by the end of August 2024. This decline was primarily due to a Dh0.9 billion drop in currency in circulation outside banks and a Dh0.4 billion decrease in monetary deposits.
The money supply aggregate M2 increased by 0.2%, rising from Dh2.205 trillion at the end of July 2024 to Dh2.211 trillion by the end of August 2024. This growth was driven by a Dh6.5 billion increase in Quasi-Monetary Deposits, offsetting the fall in M1.
The money supply aggregate M3 also increased by 0.8%, from Dh2.676 trillion at the end of July 2024 to Dh2.696 trillion by the end of August 2024. This expansion was due to the growth in M2 and a Dh15.1 billion increase in government deposits.
The monetary base expanded by 2.3%, rising from Dh718.1 billion at the end of July 2024 to Dh734.9 billion by the end of August 2024. This growth was fueled by increases in currency issued by 0.6%, reserve account by 6.2%, and monetary bills & Islamic certificates of deposit by 6.1%, countering a 10.2% reduction in banks & OFCs' current accounts and overnight deposits of banks at CBUAE.
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