UAE banks' capital, reserves cross Dh500 billion for the first time

UAE banks' total capital and reserves amounted to more than Dh500 billion — crossing the half-a-trillion mark for the first time in their history, the country's Central Bank announced on Tuesday.

The latest Central Bank statistics showed that banks' capital and reserves rose to Dh502.6 billion by the end of July, marking an annual increase of about 10.5 per cent from Dh454.9 billion in July 2023. In the first seven months of the year, the numbers jumped by about 2.7 per cent — or Dh13.3 billion — from about Dh489.3 billion at the end of 2023.

These figures do not include loans or secondary deposits, but they cover the current year’s profits, the Central Bank said.

National banks accounted for about 86.3 per cent of the total capital and reserves, with their value reaching Dh433.7 billion at the end of July — an annual increase of 10.4 per cent from Dh392.9 billion in July 2023.

The share of foreign banks reached 13.7 per cent, amounting to Dh68.9 billion at the end of July, marking an hike of 11.1 per cent from about Dh62 billion in July 2023.

Banks' investments also hit at all-time high of Dh691.2 billion by the end of July, the Central Bank's statistics show. This figure marked an annual increase of 19.3 per cent compared to about Dh579.5 billion in July 2023.

Bank investments increased on a monthly basis by 1.6 per cent, compared to Dh680.2 billion dirhams in June.

In the first seven months of the year, these investments increased by about 8.8 per cent or Dh56.1 billion, compared to about Dh635.1 billion at the end of last year

Bonds held until maturity accounted for the largest share of banks’ investments — at around 48.3 per cent — reaching Dh333.9 billion at the end of last July, an increase of around 25.1 per cent on an annual basis.

The share of banks’ investments in securities representing debts to others (“debt bonds”) amounted to about 41.9 per cent of total investments, reaching Dh289.5 billion at the end of last July and marking a 15.8 per cent increase on an annual basis.

Bank investments in stocks reached Dh17 billion last July, up by about 36 per cent year-on-year and 1.8 per cent month-on-month, while other bank investments amounted to Dh50.8 billion, a decrease of about 1.7 per cent month-on-month and an increase of 1 per cent year-on-year.

These investments do not include the bank’s deposits with the Central Bank in the form of certificates of deposit and cash bills.