The UAE banking sector experienced significant growth in 2024, with total assets reaching Dh4.457 trillion by the end of November, marking a substantial increase from Dh4.075 trillion in 2023. This surge underscores the sector’s resilience and its position as the largest in the Middle East. The net non-performing loan ratio improved to 2.1% in 2024, down from 2.4% in 2023, reflecting enhanced asset quality. Additionally, the insurance sector saw notable expansion, with gross written premiums rising to approximately Dh64.5 billion from Dh53.3 billion in 2023.
The Central Bank of the UAE (CBUAE) achieved record financial results across all indicators in 2024. Total assets were estimated to reach about Dh896 billion, driven by increased net inflows into the national economy. The UAE’s national economy performed exceptionally well, with real GDP growth estimated at 4.0% and nominal GDP projected to reach approximately Dh2 trillion in 2024, up from Dh1.9 trillion in 2023. The CBUAE implemented initiatives to support national housing programs and developed the local capital market through various financial instruments like Certificates of Deposit and Treasury bonds.
In terms of regulatory frameworks, the CBUAE issued several key regulations in 2024, including the world’s first Open Finance framework and the Middle East’s first stablecoins regulation. These efforts aim to enhance financial stability, streamline financial services, and promote sustainable economic development. The banking sector also saw a shift towards digital banking solutions, which is expected to continue growing with a forecasted 4.77% growth rate between 2024 and 2029.
The UAE’s economic performance was further bolstered by robust deposit growth, with total deposits increasing by 14.1% year-on-year in Q3 2024. This growth supported favorable funding and liquidity conditions, contributing to the sector’s overall resilience. Despite challenges such as slower loan growth and increased impairment charges, UAE banks remain well-capitalized and focused on cost efficiency and asset quality management.
The CBUAE’s initiatives and the sector’s growth highlight the UAE’s strong fiscal position and dynamic economy, supported by large sovereign wealth funds. As the banking sector continues to evolve, it is likely to remain a critical component of the UAE’s economic success.
