UAE Banking Sector Sees Continued Momentum as Gross Assets Climb to Dh4.64 Trillion

Strong increases in money supply, bank deposits, and credit highlight robust financial sector performance in February 2025, says Central Bank of the UAE.

The Central Bank of the UAE (CBUAE) has reported steady growth across key banking indicators for February 2025, with gross assets in the country’s banking sector rising by 1.6% month-on-month to reach Dh4,636.8 billion. The latest Monetary & Banking Developments report reflects continued resilience in the UAE’s financial system, supported by a healthy uptick in money supply, bank deposits, and credit expansion.

Solid Growth in Money Supply

Money supply aggregates across the board showed positive momentum:

• M1 (currency in circulation plus monetary deposits) rose by 1.8%, from Dh965.3 billion in January to Dh982.9 billion at the end of February. This was driven by a Dh4.1 billion increase in currency outside banks and a Dh13.5 billion rise in monetary deposits.
• M2, which includes M1 plus quasi-monetary deposits, also increased by 1.8% to Dh2,361.9 billion. This rise was attributed to both the M1 expansion and a Dh25.0 billion increase in quasi-monetary deposits.
• M3, the broadest measure of money supply that includes government deposits, grew by 0.8% to Dh2,813.4 billion. The growth in M2 outweighed a Dh19.0 billion decline in government deposits, ensuring overall positive movement.

Expanding Monetary Base

The monetary base climbed by 3.1%, reaching Dh816.6 billion at the end of February. This was driven by:

• A 3.4% increase in currency issued
• An 11.4% rise in overnight deposits by banks and other financial corporations at the CBUAE
• A 6.2% increase in monetary bills and Islamic certificates of deposit

These gains more than offset a 6.1% decrease in the reserve account.

Banking Sector Assets and Credit on the Rise

Total gross bank assets, including bankers’ acceptances, reached Dh4,636.8 billion—an increase of Dh74.5 billion over January’s figure.

Gross credit rose by 0.9% to Dh2,205.1 billion. This growth was propelled by:

• A Dh1.7 billion increase in domestic credit, particularly to the private sector (+0.7%) and non-banking financial institutions (+5.2%)
• A Dh17.1 billion boost in foreign credit

Notably, credit to the public sector (government-related entities) and to the government declined by 2.0% and 1.4%, respectively.

Surge in Bank Deposits

Bank deposits showed solid growth, climbing by 1.2% to Dh2,874.6 billion. The increase was driven by:

• A 0.8% rise in resident deposits, totaling Dh2,625.5 billion
• A 5.1% jump in non-resident deposits, reaching Dh249.1 billion

Within resident deposits, growth was evident across key segments:

• Government-related entities: +3.8%
• Private sector: +1.4%
• Non-banking financial institutions: +5.6%
• Government sector: -4.0%

This comprehensive monthly update from the Central Bank reinforces the UAE’s standing as a regional financial hub, with healthy liquidity, strong deposit growth, and expanding credit lines. As the country continues to prioritize economic diversification and financial resilience, the banking sector’s sustained momentum offers a positive outlook for the remainder of 2025.