UAE Banks: Relatively Weak Annual Loan Growth Expected In Q2, Q3 | MENA startups, innovation, and tech news

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UAE Banks: Relatively Weak Annual Loan Growth Expected In Q2, Q3
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UAE Banks: Relatively Weak Annual Loan Growth Expected In Q2, Q3

Total Bank lending among UAE banks slumped by 1.3% month after month & 0.8% on year to year basis in march 2021, according to details by Emirates ended on Thursday. This was the first twelve-month decline in bank lending since last 2015 & exhibits to some extent the high yearly base.

The UAE’s bank loan expansion was exacerbated to 1.3% on monthly basis & 5.6% on yearly basis in March 2020 as COVID-19 jolted the economy & the Central Bank announced the TARGETED ECONOMIC SUPPORT SCHEME (TESS), enabling banks to improve loan.

Khatija Haque, Head of Research & Chief Economist at Emirates NBD said, “As such, we would not be surprised to see relatively weak annual loan growth through Q2 & into Q3 this year” The report announced that lending to the private sector shrank by 3.7% on year to year basis in March as a credit to business & the industrial sector reduced by 1.0% on month to month basis & 5.4% on year to year basis.

Advancing to the Government has also decelerated in neoteric months, easing to 8.7% on the year-to-year basis in March 2020 base. Bank lending growth to the public sector culminated at 24.5% on year to year basis in June 2020, before declining as the economy reopened in H2 2020. Khatija Haque further added that blooming growth to the public sector continued to slow as the economic redemption secured momentum as anticipated.

11th UAE National Banks relayed 7.74 billion dirhams ($2 billion) in a net gain, for the quarter ended in March 2021, an extension of 9.6% over the same period last year. Amidst, the sixth Abu Dhabi ADX-listed banks booked around 4 billion dirhams in excess, weigh up with 2.967 billion dirhams in bygone days.

In Dubai, NBD came to surmount with a net profit of 2.32 billion dirhams in Q1 2021 whereas Dubai Islamic Bank accompanied with 846 million in net profit.

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