UAE banks increased the amount of provisions to jump to 100.3 billion dirhams at the end of last January, in order to meet the troubled loans and outstanding interest that the banks took during the first month of this year by the amount of Two billion dirhams.


According to ArabiaNet, banks increased the size of general allocations to face any future challenges by 100 million dirhams, increasing the size of these allocations to 33.3 billion dirhams at the end of last January, according to figures recently disclosed by the central bank.


Thus, the total provisions at the end of last January would have increased to 133.6 billion dirhams, which constituted about 7.69% of the size of the banks ’financing portfolio at the end of last January, and 5.73% of the risk weighted assets, which amounted to 2330.48 billion dirhams at the end of September 2019.


The allocations to face bad debts and outstanding interest rates increased by 1.5%, while the finance and credit facilities portfolio fell by 1.3% during January to 1736.9 billion dirhams, which could indicate the precautionary policy of banks and the decline in public demand, especially as the rate of inflation continued the negative path During the year 2019, it decreased by 1.6%.


It is noteworthy that the decline in the credit portfolio during last January focused on the local market for residents, especially on the main preferred destinations for banks: government agencies (a decrease of 11%), and public sector companies affiliated with local and federal governments (a decrease of 0.8%), and the bank loan portfolio declined Individuals increased by $ 100 million, while the private sector financing portfolio increased slightly by 0.2%.