UAE Central Bank Approves Resilience Package to Strengthen Banking Sector, Economy
It introduces five key measures, including enhanced access to liquidity, temporary relief on liquidity and funding ratios, and the release of capital buffers to give banks greater flexibility in supporting the economy.
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The Central Bank of the UAE (CBUAE) Board has approved a Financial Institution Resilience Package to strengthen the stability of the country’s banking sector and support the economy amid regional challenges.
The package was approved during the second meeting of the board chaired by H.H. Sheikh Mansour bin Zayed Al Nahyan, Vice President, Deputy Prime Minister and Chairman of the Presidential Court, and Chairman of the Board of Directors of the CBUAE.
It introduces five key measures, including enhanced access to liquidity, temporary relief on liquidity and funding ratios, and the release of capital buffers to give banks greater flexibility in supporting the economy.
Under the measure, banks will be allowed to access reserve balances of up to 30% of their cash reserve requirements, alongside term liquidity facilities in both dirhams and US dollars. The package also provides flexibility in loan classification for customers affected by current conditions.
The CBUAE said the banking sector remains strong, supported by liquidity of about AED920 billion and a sector valued at AED5.4 trillion. Foreign exchange reserves exceed AED1 trillion, with a monetary base cover ratio of 119%.
The CBUAE also affirmed that banks should continue providing financing to support customers and the national economy amid extraordinary circumstances.
Related: Dubai’s Business and Investor Confidence Holds Firm Amid Regional Uncertainty
The Central Bank of the UAE (CBUAE) Board has approved a Financial Institution Resilience Package to strengthen the stability of the country’s banking sector and support the economy amid regional challenges.
The package was approved during the second meeting of the board chaired by H.H. Sheikh Mansour bin Zayed Al Nahyan, Vice President, Deputy Prime Minister and Chairman of the Presidential Court, and Chairman of the Board of Directors of the CBUAE.
It introduces five key measures, including enhanced access to liquidity, temporary relief on liquidity and funding ratios, and the release of capital buffers to give banks greater flexibility in supporting the economy.
Under the measure, banks will be allowed to access reserve balances of up to 30% of their cash reserve requirements, alongside term liquidity facilities in both dirhams and US dollars. The package also provides flexibility in loan classification for customers affected by current conditions.
The CBUAE said the banking sector remains strong, supported by liquidity of about AED920 billion and a sector valued at AED5.4 trillion. Foreign exchange reserves exceed AED1 trillion, with a monetary base cover ratio of 119%.
The CBUAE also affirmed that banks should continue providing financing to support customers and the national economy amid extraordinary circumstances.
Related: Dubai’s Business and Investor Confidence Holds Firm Amid Regional Uncertainty
