Reduced loans hold back credit in UAE - The National

UAE credit expansion failed to pick up speed in April as growth in bank lending to the government sector shrank.

Outstanding loans to the private sector reached Dh821 million (US$223.5m) in April, up 2.6 per cent from the same month a year earlier, data released yesterday from the Central Bank's statistical bulletin showed. It was about the same growth rate as the month earlier.

Viewed as less of a credit risk than private businesses, lending to public sector enterprises has been a cornerstone of banks' growth plans since the global financial crisis. But the rate of annual growth eased to 10.5 per cent to reach Dh123.4m in April, sharply down from lending levels in the first quarter.

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