A sharp slowdown of bank deposit growth in the United Arab Emirates suggests inflows of money into the country are slowing or even reversing, as low interest rates deter depositors and the impact of the Arab Spring fades.
Annual growth of deposits at UAE banks, which remained below 7.5 percent throughout last year, hit double-digit rates in February this year and a peak of 16.0 percent in April. Growth stayed extremely strong through July, when it was 11.5 percent.
Bankers and analysts said two main factors seemed to be behind the growth. One was capital flight into the UAE, which has remained politically stable this year, from countries in the Gulf and North Africa which experienced political turmoil; growth in non-residents' deposits, which account for roughly a tenth of total deposits, hit 40 percent in February.
No comments:
Post a Comment