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19 March 2024

Central Bank assets dip Dh5bn

Published
By Staff

 

The UAE Central Bank’s total assets declined by around Dhfive billion at the end of June following a sharp fall in deposits with banks abroad but the assets remained at their highest level in nearly four years.

From about Dh273 billion at the end of May, the central bank’s total assets shrank to nearly Dh273 billion at the end of June, their first decline in many months, the central bank’s monthly indicators showed.

The decline followed a surge by nearly Dh50 billion in the first five months of 2011 but the assets remained at their highest level since the end of 2007, when they were at a record high of around Dh285 billion.

The decline in June was a result of a drop in the central bank’s deposits with banks abroad as they dipped to nearly Dh73.6 billion from Dh81.7 billion at the end of May following a sharp rise over the previous months.

The deposits at the end of June were far below their peak of Dh184 billion at the end of 2007 but sharply above their level at the end of 2010, when they were estimated at nearly Dh44.5 billion.

The retreat in deposits was partly offset by an increase in the central bank’s held-to-maturity investments, which swelled by about Dhfour billion to nearly Dh192.7 billion at the end of June from around Dh188.2 billion at the end of May.

Their level at the end of June was the highest ever and nearly Dh17 billion above their level at the end of 2010 and Dh86 billion over 2009.

On the liabilities side, the report showed certificates of deposits held by the UAE’s 23 national banks and 28 foreign units slipped to nearly Dh118.2 billion at the end of June from Dh118.2 billion at the end of May.

CDs issued by the central bank have steadily grown over the past two years following a sharp decline at the end of 2008, when they tumbled to only around Dh47 billion as banks were in bad need for cash due to a severe shortage in the wake of the global fiscal distress.

CDs began to recover through 2009 with the improvement in the banks’ liquidity. At the end of 2009, they rebounded to Dh71.4 billion.

The CD investments fluctuated through 2010 but remained far higher than at the end of 2008 before they peaked at a three-year high at the end of May.

The report showed banks’ deposits with the central bank grew to around Dh82.7 billion at the end of June from Dh80.5 billion at the end of May while capital and reserves remained at nearly Dh17.15 billion.