The United Arab Emirates central bank plans to cap loan growth at local banks at 10 per cent this year to prevent additional government-supplied liquidity from spurring last year’s rampant credit growth.
“The 10 per cent growth cap will be enforced until further notice,” Sultan bin Nasser Al Suwaidi, the central bank governor, told a local newspaper on Tuesday. “This is part of our measures to handle the impact of the financial crisis.”
The central bank last year put in place a Dh50bn credit facility for banks operating in the UAE, while the finance ministry said it would deposit as much as Dh70bn in banks to help ease financing strains.
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