UAE central bank temporarily relaxes rules on liquidity, funding for banks | ZAWYA MENA Edition:
The United Arab Emirates' central bank said on Saturday it was temporarily relaxing two key requirements to improve liquidity and funding needs of banks to encourage them to lend more to businesses under the COVID-19 economic stimulus plan.
Banks will be allowed to go below the 100% 'net stable funding ratio' (NSFR) but not below 90%, and above the 100% requirement for 'advances to stable resources ratio' (ASRR) but no higher than 110%, until December 31 2021.
"This step comes as an additional measure encouraging banks to strengthen the implementation of the Targeted Economic Support Scheme and support their impacted customers in overcoming the repercussions of COVID-19 pandemic," the central bank said in a statement.
The central bank has announced about $70 billion worth of economic stimulus to help businesses cope with the outbreak of the coronavirus outbreak. The economy is likely to contract by 3.6% this year, the central bank said in June.
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