UAE National Banks Lead in Business Lending Growth

In the first quarter of 2024, the total credit balance in the business and industrial sectors of the UAE reached 757.4 billion dirhams ($206.2 billion), showing a positive trend in lending activities. National banks in the UAE played a significant role by providing credit facilities amounting to 15.6 billion dirhams during this period.

Compared to the previous year, the credit balance increased by 15.6 billion dirhams, indicating a consistent rise in lending. Year-on-year, there was a 3.02 percent increase in credit availability, reaching 22.2 billion dirhams in March 2024, showcasing ongoing financial support.

National banks dominated the lending landscape, contributing 90 percent of the total credit balance, with foreign banks holding a smaller share. Abu Dhabi-based banks extended credit worth 374.1 billion dirhams, while Dubai-based banks provided 363.3 billion dirhams, demonstrating a balanced regional distribution of financial resources.

Conventional financial institutions remained the preferred choice for credit financing, accounting for 82.5 percent of the total credit extended to the trade and industry sectors by March 2024. Islamic banks also played a significant role, contributing approximately 17.5 percent of the financing.

In 2023, the UAE's industrial sector contributed $54 billion to the country's GDP, reflecting a 9 percent increase from the previous year. This growth was attributed to a supportive business environment that enhances the growth and competitiveness of UAE companies.

The UAE's credit sector continues to show positive growth, with national banks leading the way in providing financial support to the business and industrial sectors. The increasing credit availability and balanced regional distribution of financial resources indicate a healthy lending environment that supports economic growth. With conventional and Islamic banks playing complementary roles in financing, the UAE's financial sector remains robust and supportive of the country's economic development.