Blacktower FM - Issue 18 - 2026 Magazine - Flipbook - Page 66
DEUGBAACI YE D
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I TI ITOI O
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ECONOMICS
BANKING AND FINANCIAL
SERVICES EVOLUTION
IN THE UAE: TRENDS,
GROWTH, AND SECTOR
HEALTH
By Jordan Pemberton,
Interna琀椀onal Financial Adviser at Blacktower Financial Management
The UAE’s banking sector con琀椀nues to demonstrate resilience and adaptability, bolstered by solid
credit growth, rising deposit volumes, and suppor琀椀ve monetary policies. As the na琀椀on navigates
global economic 昀氀uctua琀椀ons, the UAE Central Bank’s strategic measures have played a signi昀椀cant
role in maintaining the sector’s stability and investor con昀椀dence. This report provides an overview of
the latest trends in credit growth, deposit pa琀琀erns, and the central bank’s in昀氀uence on the 昀椀nancial
market, re昀氀ec琀椀ng the overall health of the UAE’s banking sector.
CREDIT GROWTH: STEADY INCREASES
AMID HIGH DEMAND
DEPOSIT TRENDS: ROBUST GROWTH
AND LIQUIDITY
The UAE’s banking sector has shown steady
credit growth throughout 2023, driven by
increased demand from both individuals and
government-related en琀椀琀椀es (GREs). According
to Emirates NBD Research, credit growth
reached 5.1 percent year-on-year by October
2023, marking a strong rebound compared to
the previous year. This increase was largely
fueled by loans to individuals, which rose by
11 percent year-on-year, highligh琀椀ng the
growing demand for personal 昀椀nancing as
consumer con昀椀dence improves.
The UAE’s banking sector has also seen robust
growth in deposits, re昀氀ec琀椀ng a healthy liquidity
posi琀椀on. MEED Research data reveals an 11.4
percent increase in bank deposits year-on-year
by October 2023, with corporate deposits
growing over 20 percent. This rise in deposits
has been supported by higher interest rates,
which make saving in UAE banks increasingly
a琀琀rac琀椀ve for businesses and individuals alike.
Business loan growth, while s琀椀ll posi琀椀ve, has
been more conserva琀椀ve at 2.1 percent yearon-year, as many businesses remain cau琀椀ous
about taking on new debt amidst global
economic uncertain琀椀es. However, GREs
have con琀椀nued to borrow for infrastructure
projects and expansion plans, with GRE loans
growing at a rate of 9.6 percent. These trends
underscore the balanced credit growth in the
UAE, where both retail and government-led
segments contribute to the sector’s resilience.
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Individual deposits have grown by 17 percent,
indica琀椀ng consumer con昀椀dence in the sector,
while GRE deposits rose by 14 percent, further
adding to the liquidity available for banks to
meet credit demand. Emirates NBD Research
notes that this liquidity in昀氀ux has allowed the
UAE’s banks to maintain compe琀椀琀椀ve lending
rates while suppor琀椀ng credit expansion, a
cri琀椀cal factor in sustaining economic growth.
