Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
The non-performing loans (NPLs) of the UAE banks dropped to 3.4% of total gross loans at the end of the second quarter of 2025, down from 3.8% in Q1 and 4.8% a year earlier, according to the Central Bank of the UAE (CBUAE) data.
The stock of NPLs fell to Dh91.05 billion in June 2025, compared with Dh94.41 billion in March and Dh110.82 billion in June 2024.
The data signals a healthy decline in bad loans in both absolute terms and as a proportion of the banking sector’s lending portfolio.
Total banking sector assets reached Dh4.97 trillion in Q2 2025, an increase of 5.4% quarter-on-quarter and 15.4% year-on-year. Gross credit expanded to Dh2.33 trillion, up 4.2% on the quarter and 11.1% compared with June 2024
Customer deposits also strengthened, rising 3.7% (QoQ) and 13.1% (YoY) to Dh3.05 trillion. Resident deposits accounted for Dh2.79 trillion, up 3.8% (QoQ), while non-resident deposits increased 3.5% (QoQ) to Dh257.2 billion.
Banks’ aggregate capital and reserves stood at Dh545.7 billion in Q2, up 4.1% (QoQ). The capital adequacy ratio was reported at 17.3%, well above regulatory requirement of 13.0%.
The Abu Dhabi Securities Exchange (ADX) recorded a 2.3% quarterly gain in its general index during Q2 2025, with market capitalisation rising by Dh48 billion to Dh3.01 trillion. Quarterly traded values climbed 15.8% to Dh96.1 billion
The Dubai Financial Market (DFM) index advanced 5.8% in the quarter, while market capitalisation increased by Dh41 billion to Dh953.2 billion. Traded values rose to Dh43.1 billion, up 7.6% quarter-on-quarter
The continued decline in NPLs, alongside double-digit growth in assets, credit, and deposits, underscores the resilience of the UAE’s banking system. Strong capital buffers and robust financial market activity further highlight stability across the wider financial sector.
