Arab News, Thu, Mar 21, 2024 | Ramadan 11, 1445
UAE Islamic banks assets hit $191bn: CBUAE
Emirates:
UAE Islamic banks saw their asset values rise to 703 billion dirhams ($191.4
billion) by the end of 2023 in what was an 11 percent annual increase, official
data showed.
Figures released by the Central Bank of the UAE
revealed this was a jump from 630.7 billion dirhams in December 2022, marking a
growth of 72.4 billion dirhams over 12 months.
On a month-on-month basis, assets increased by 0.6
percent in December, totaling 4.2 billion dirhams compared to November’s 698.8
billion dirhams.
Islamic banks follow Shariah principles, providing
diverse financial services, including investments, and deposits, avoiding
interest-based transactions, and upholding ethical standards.
CBUAE has issued licenses to several fully-fledged
Islamic banks, including Abu Dhabi Islamic Bank, Ajman Bank, and Al Hilal Bank.
Additionally, BOK International Bank, Dubai
Islamic Bank, Emirates Islamic Bank, and Sharjah Islamic Bank have also received
licenses to operate in this sector.
According to CBUAE’s data, credit extended by
Islamic banks rose to 428.9 billion dirhams by December, up 7.82 percent
annually from 397.8 billion dirhams.
Meanwhile, deposits in such institutions witnessed
a surge, reaching 495.3 billion dirhams by the end of 2023, reflecting a yearly
growth of about 12.6 percent from 439.8 billion dirhams in December 2022.
On a monthly basis, deposits increased by 0.9
percent compared to November 2023’s 491.1 billion dirhams.
These banks saw their total investments reach
132.7 billion dirhams by December, marking a 27.1 percent, or or 28.3 billion
dirhams, annual increase, while monthly investments rose by about 1 percent.
The breakdown of these investments includes 100.4
billion dirhams in bonds held to maturity, 18.7 billion dirhams in financial
instruments representing debt on others, and 2.6 billion dirhams in shares. This
also encompasses 11 billion dirhams in other investments within the portfolio.
In comparison, traditional banks operating in the
UAE witnessed substantial growth in their total assets, reaching 3.3 trillion
dirhams by the end of last year. This marked an 11 percent annual increase from
3 trillion dirhams, reflecting a rise of 335.2 billion dirhams over the year.
By December, conventional banks comprised roughly
82.7 percent of the total assets of the country’s banking system, totaling 4
trillion dirhams, whereas Islamic banks held a 17.3 percent share.
Meanwhile, conventional banks extended a total
credit of 1.5 trillion dirhams by December, marking a 5.5 percent yearly
increase, while deposits surged to 2 trillion dirhams.
The total investments of conventional banks grew
by 15.6 percent annually to 488.8 billion dirhams by December. This included
246.2 billion dirhams in financial instruments representing debt on others,
204.4 billion dirhams in bonds held to maturity, 13.2 billion dirhams in shares,
and 37.9 billion dirhams in other investments.