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(Updates with economist’s quote in third paragraph.)
Sept. 29 (Bloomberg) -- United Arab Emirates’ overall bank deposits exceed loans for an 11th month in August, the central bank on its website today.
Loans rose 0.5 percent in August from July to 1,056.8 billion dirhams ($288 billion), while deposits dropped 3.2 percent 1,078.4 billion dirhams, the data said. Specific provisions for bad loans rose 1.7 percent in August from July to 49.2 billion dirhams, the data showed.
“Things domestically have improved and normalized to an extent,” said Marios Maratheftis, Dubai-based chief economist for the Middle East at Standard Chartered Plc. “We had loans exceeding deposits for a long time, that was worrisome as it was a sign that banks did not really have room to resume credit growth.”
The U.A.E. has sought to boost bank lending after the global crisis squeezed a credit market that had been growing more than 30 percent annually in the previous three years. In response, the government guaranteed all local bank deposits and interbank loans, created a 50 billion-dirham credit facility and said it would pump 70 billion dirhams into banks.
--Editors: Andrew J. Barden, Shaji Mathew
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