UAE’s banking sector liquid assets stand at Dhs786.6b

The liquid assets in the UAE banking sector stood at Dhs786.6 billion at the end of Q1-24, marking a year-on-year increase of 28.2%, or Dhs172.8 billion, compared to approximately Dhs613.8 billion at the end of Q12023.

In its report on key financial stability indicators for Q1-24, released today, the Central Bank of the UAE (CBUAE) stated that the value of these liquid assets increased on a quarterly (q-o-q) basis by 5.7%, or Dhs42.7 billion, compared to approximately Dhs743.95 billion at the end of the Q4-23.

The value of these assets constituted 18.8% of the total banking sector assets, which amounted to AED4.185 trillion at the end of Q1-24, up from 18.6% at the end of Q4-23.

CBUAE pointed out that the UAE banking system is well-capitalised, with the overall capital adequacy ratio reaching 18% by end of Q1-24, compared to 17.9% at the end of Q4-23.

It explained that the capital adequacy ratio is still significantly higher than the minimum capital adequacy requirement of 13%, which includes a capital conservation buffer of 2.5% and a minimum Tier 1 capital requirement of 8.5%, as stipulated in the Central Bank’s regulations in compliance with the Basel III guidelines, which have been followed by banks in the UAE since December 2017.

Instant Payment System: The Central Bank of the UAE (CBUAE) has said that its payment systems maintained operational strength in 2023. This includes the Image Cheque Clearing System (ICCS), UAE Fund Transfer System (UAEFTS), UAE Direct Debit System (UAEDDS), UAE Wages Protection System (UAEWPS), UAE Switching System (UAESWITCH), and the Instant Payment System (Aani).

In its latest report released today, the Central Bank added that the number of transactions on Aani increased significantly, recording 64.1 million transactions valued at Dhs164.7 billion in 2023, compared to 38.3 million transactions valued at Dhs101.2 billion in 2022.

The Central Bank stated that the average number of employees registered in the UAEWPS rose from 5.2 million in 2022 to 5.9 million in 2023. Additionally, the total number of salary payments increased from Dhs55.5 million to Dhs62.6 million, with the value of paid salaries rising to Dhs296 billion compared to Dhs246 billion in 2022.

According to the report, the number of employers registered in the UAEWPS by the end of last year increased to 306,450 from 275,680, marking an 11% increase compared to 2022.

The report noted that last year saw a total of 22.9 million cheques valued at Dhs1.31 trillion processed through the ICCS, representing a 1.1% increase in volume and a 3.14% growth in value compared to 2022.

The Central Bank noted that the UAEFTS recorded 89.5 million transactions totaling Dhs6.14 trillion for individual transfers in 2023, marking a 20% increase in volume and a 25% increase in value compared to 2022.

Total institutional transfers reached 674,000 transactions amounting to Dhs11 trillion by the end of last year, reflecting a yearly increase of 6.44% in volume and 41.3% in value.

According to the report, the UAEDDS processed 17.8 million transactions totaling Dhs106.9 billion in 2023, with transaction volume increasing by 34% compared to 2022, and transaction value rising by 23.7% annually.

The report highlighted that the UAESWITCH conducted 74.2 million transactions amounting to Dhs120 billion in 2023, representing a 4.7% increase in transaction volume and an 11% increase in value year-on-year.

Additionally, the UAE Payment Gateway System (UAEPGS) processed 2.4 million transactions totaling AED8.95 billion in 2023.

Gold reserves: The value of gold reserves of the Central Bank of the UAE (CBUAE) reached Dhs19.615 billion by the end of March 2024, marking a year-on-year (YoY) growth of 12.6 percent from Dhs17.41 billion in March 2023.

The apex bank, in its latest figures released today, showed that gold reserves increased by 9.8% percent on a monthly basis from Dhs17.86 billion in February 2024.

The UAE’s gold reserves have significantly grown over the past years from Dhs4.044 billion at the end of 2019, and Dhs1.134 billion in 2018.