The UAE had the biggest share of banking assets in the Arab region in 2023, with a 24.3% share, achieving the biggest y-o-y growth at 11%, according to an Arab Monetary Fund (AMF) report (pdf). The total value of banking assets among Arab countries amounted to USD 4.574 tn in 2023, growing by 5% compared to USD 4.355 tn in 2022.

The breakdown: The UAE came second after Saudi Arabia in terms of share of individual banking credit facilities, with USD 542.2 bn in credit facilities handed out in 2023. The UAE also took the lead in banking deposits among Arab countries in 2023 with USD 686.7 bn in deposits, followed by Saudi Arabia with USD 659.6 bn.

The rate of return on assets recovered in the UAE after the covid-19 pandemic, rising to 2% in 2023, up from 0.7% in 2020 and 1.4% in 2022. The country came in second place after Saudi Arabia’s 2.2% rate of returns and surpassed the 1.39% average for the region in the same year.

Positive banking operational performance indicators: The UAE had the second highest loan loss provisions coverage ratio in 2023 at 93.8% — reflecting confidence in the ability of banks to face financial obstacles that result from irregular loan payments, the report states. The UAE’s net interest margin reached 72.6% in 2023 which is above the average margin for the Arab banking sector of 69.3%.

A flourishing currency exchange sector: The UAE currently owns 47.3% of the currency exchange services sector in the Arab world. The total capital of this sector across Arab countries amounted to USD 2.9 bn in 2023, growing 3.6% y-o-y, while asset value remained flat at around USD 4.7 bn.

The UAE took the lead in terms of the number of fintechs in the region among Arab countries, with 700 of the region’s c.1.2k fintechs setting up shop in the UAE, with a total investment of USD 1.3 bn during the year.

Tags: