UAE bank assets rise to AED 5.633 trillion in May, Central Bank reports
UAE bank assets climbed to AED 5.633 trillion in May as credit and deposits increased, Central Bank data show; M3, reserves and payment volumes also expanded.
The Central Bank of the UAE reported that total banking assets, including acceptances, rose 1.1% in May to AED 5.633 trillion, up from AED 5.57 trillion at the end of April. This uptick in UAE bank assets was accompanied by a modest increase in overall bank credit and a noticeable growth in banks’ reserve balances at the central bank.
Credit growth lifted by local lending
Total bank credit increased by AED 12.3 billion, or 0.5%, reaching AED 2.733 trillion at the end of May compared with the end of April. The rise in lending was driven primarily by local credit, which expanded by AED 13.8 billion and offset a slight negative contribution from foreign credit.
Data show that all major domestic sectors contributed positively to local credit growth, underscoring broader demand for financing across the economy. The pattern suggests strengthening domestic activity and sustained appetite for borrowing among businesses and households.
Private sector and retail advances fuel expansion
A key engine of the rise in UAE bank assets was increased lending to the private sector, with both corporate and household borrowing each rising by roughly AED 4.6 billion. Each of those components contributed about 0.2 percentage points to the monthly growth in local credit, according to the central bank figures.
In addition, credit to government-related entities rose by AED 3.5 billion, or about 1%, adding further momentum to the expansion in total local lending. The combined increase across private, retail and public-related borrowers reflects a broad-based credit expansion rather than concentration in a single segment.
Deposits and monetary aggregates trend higher
Bank deposits stood at AED 3.463 trillion at the end of May, providing a stable funding base for the sector as UAE bank assets grew. The central bank’s monthly statistical bulletin showed that narrow money (M1) amounted to about AED 1.054 trillion, with currency in circulation at AED 167.6 billion and demand deposits at AED 885.9 billion.
Broader monetary measures also rose, with M2 at approximately AED 2.854 trillion and quasi-money balances in dirhams increasing to AED 1.135 trillion. These developments helped support the monthly rise in money supply measures and signalled continued liquidity in dirham-denominated deposits.
M3, government deposits and reserve build-up
The broadest measure of money supply, M3, reached about AED 3.393 trillion by the end of May, marking a 0.4% increase for the month. Government deposits climbed to AED 539.5 billion, making a positive contribution to the monthly change in M3 and enhancing the overall liquidity profile of the banking sector.
The central bank reported the monetary base at AED 848.5 billion at month-end, while banks’ reserve balances held at the Central Bank rose sharply by 49.4% to AED 295.4 billion. The large increase in reserve balances signals a significant shift in banks’ liquidity placement with the central bank during the month.
Payments activity on UAEFTS remains robust
Payments data showed continued high volumes through the UAE Funds Transfer System (UAEFTS), with cumulative domestic transfer values reaching AED 11.502 trillion over the first five months of the year. Of that total, banks executed roughly AED 6.903 trillion in transfers and other participants — including corporate and retail customers — accounted for about AED 4.6 trillion.
During May alone, the value of transfers processed via UAEFTS amounted to AED 2.118 trillion, split between AED 1.199 trillion executed by banks and AED 919.1 billion by other users. The sustained high turnover through the national payments system reflects active financial flows and transactional demand in the UAE economy.
Central bank gold holdings stood at AED 39.937 billion at the end of May, indicating the institution’s continued accumulation and valuation of precious metal reserves. This figure was included in the monthly statistical release alongside other balance-sheet items.
Overall, the Central Bank’s May report portrays a banking sector with expanding assets, rising credit to the domestic economy, stable deposit funding and elevated liquidity parked at the central bank. These trends influenced the growth in UAE bank assets and underscored active payment and reserve developments during the month.