The Central Bank of the UAE announced an increase in total banking assets, including certificates of deposit, by 0.5% on a monthly basis to 3.9 trillion dirhams at the end of August, marking the first time in its history this figure was reached, compared to approximately 3.882 trillion dirhams at the end of July 2023. The central bank, in its Monetary and Banking Developments report for August 2023, stated that banking sector assets rose by 10.7% annually, equivalent to 378 billion dirhams, compared to around 3.52 trillion dirhams in August 2022.
The report indicated that total bank credit increased to 1.953 trillion dirhams at the end of August, rising by 0.7% from 1.939 trillion dirhams at the end of the previous July, due to a 0.8% increase in total domestic credit. The central bank attributed the rise in domestic credit to increases of 0.6%, 1.4%, and 0.8% in credit extended to the government sector, public sector entities (government-related entities), and the private sector, respectively.
According to the central bank's report, total bank deposits increased by 0.4% from 2.393 trillion dirhams at the end of July to 2.403 trillion dirhams at the end of August, owing to a 0.1% rise in resident deposits and a 4.1% increase in non-resident deposits. The central bank explained that the increase in resident deposits was attributed to rises in private sector deposits and deposits by non-banking financial institutions by 0.7% and 2.6%, respectively.
As per the report, the monetary base reached 613.5 billion dirhams at the end of August, with reserve accounts rising by 50.5%. The report detailed that the total money supply "M1" - which includes cash in circulation outside banks plus demand deposits - was approximately 778 billion dirhams at the end of August.
Furthermore, the report noted a 0.1% increase in the total money supply "M2" - which includes "M1" plus quasi-money deposits (time deposits and savings deposits in dirhams for residents and deposits of residents in foreign currencies) - rising from 1.859 trillion dirhams at the end of July to 1.86 trillion dirhams at the end of August, owing to an increase of 5.2 billion dirhams in quasi-money deposits.
The total money supply "M3" - which includes "M2" plus government deposits at banks operating within the state and at the central bank - reached 2.295 trillion dirhams at the end of August.
