The new statistics released by the Central Bank of the UAE (CBUAE) have shown substantial growth in the banking sector’s capital, reserves, and investments as of June 2024.
The total capital and reserves of banks operating in the United Arab Emirates reached AED 495.2 billion at the end of June 2024, marking a 10.6 per cent year-on-year (YoY) increase from AED 447.8 billion in June 2023.
On a monthly basis, this figure grew by 1.5 per cent, while the first half of 2024 saw a 1.2 per cent increase.
UAE Bank Reserves See Significant Increase
The CBUAE clarified that these figures “do not include subordinated borrowings/deposits, but do include the current year’s profits,” according to a statement by the Emirates News Agency (WAM).
The National banks led the sector representing 86.3% of the total capital and reserves.
Their value reached AED 427.5 billion at the end of June, a 10.6 per cent YoY increase from AED 386.6 billion in June 2023.
Foreign banks held a 13.7 per cent share, with their capital and reserves valued at AED 67.7 billion at the end of June. This represents a 10.6 per cent YoY increase from AED 61.2 billion in June 2023.
In a related development, bank investments in the UAE reached a record high, exceeding AED 680 billion at the end of June.
This marks an 18.4 per cent YoY increase, rising from AED 574.3 billion in June 2023 to AED 680.2 billion in June 2024 – an increase of AED 105.9 billion over 12 months.
Monthly data showed a 1.07 per cent increase in bank investments from May to June 2024. The first half of 2024 saw a 7.1 per cent rise, equivalent to AED 45.1 billion, from AED 635.1 billion at the end of 2023.
Growth Fuelled By Bonds And Equity
Bonds held to maturity constituted the largest portion of bank investments at 48.8 per cent, totaling AED 332.2 billion at the end of May. This category saw a 0.1 per cent month-on-month (MoM) increase and a 26.2 per cent YoY growth.
Investments in debt securities accounted for 41.1 per cent of total investments, reaching AED 279.6 billion at the end of June. This represents a 2 per cent MoM and 12.5 per cent YoY increase.
Equity investments by banks reached AED 16.7 billion in June, showing a significant 38 per cent YoY and 1.8 per cent MoM growth. Other investments totaled 51.7 per cent, up 2.2 per cent MoM and 2.6 per cent YoY.
CBUAE stated these investment figures exclude banks’ deposits with the Central Bank in the form of Certificates of Deposit and Monetary Bills.
