Dubai: The UAE’s banking sector remains well-capitalised, highly liquid, sound and stable — all of which is solidifying the foundations of financial stability in the UAE — the UAE Banks Federation (UBF) said in its annual report for the year 2018.

Total banking assets at the end of December 2018 reached $780 billion (Dh2.8 trillion), maintaining the UAE banking sector’s position as the largest in the Arab world.

As the sector embraces new initiatives and developments, and with increased regulation and compliance requirements, prospects for 2019 and beyond appear promising.

The UBF report says the soundness of the banking sector remained positive in 2018.

Furthermore, banks operating in the UAE remained well-capitalised, with the capital adequacy ratio (CAR) reaching 17.5 per cent while CAR for Tier 1 capital reached 16.2 per cent and Common Equity Tier 1 (CET1) stood at 14.3 per cent at the end of 2018, which is well above the regulatory requirements set by the Central Bank of the UAE and Basel III.

“The UAE banking and financial sector has maintained its robustness and high performance with a strong and diversified national economy, a safe and stable political and economic climate at the national level, and the optimal use of financial and human resources,” said Abdul Aziz Al Ghurair, chairman of UAE Banks Federation.

New initiatives

The UBF said, over the last year, it launched a number of key initiatives designed to boost innovation and further strengthen the UAE banking sector.

Among these is the Emirates Digital Wallet Company, which was initiated by the federation with the participation of 16 major UAE banks with the aim of contributing to financial inclusion.

Other initiatives include cybersecurity intelligence system, the ‘Tasharuk’ Platform — designed for the sharing and exchange of information on cyber threats between UBF and bank members — and the Courts Banking Experts Accreditation, an online system launched in collaboration with the Ministry of Justice and the Central Bank of the UAE for testing and certifying local banking experts.

Other initiatives from the banking body includes the Ethical Selling Framework, the Customer Complaint Handling Framework, the Higher Sharia Authority.

The Anti-Money Laundering and Sanctions Compliance also comprise the unique initiatives UBF engaged in this year.

The report said, as a result of escalating trade tensions and the impediments such a situation may create, trade volumes between developed countries may witness a slowdown.

In the event of such a slowdown, oil prices may follow a downward trend following their 2018 highs, which would in turn lead to deceleration in MENA oil exporters’ growth.

Middle East Banking Forum

The seventh edition of the UBF’s Middle East Banking Forum (MEBF) will be held in association with

Refinitiv (formerly known as Thomson Reuters Financial and Risk Business) under the theme “Unlocking the Future, Shifting the paradigm”, which will bring together 500 industry leaders including governors, c-executives from official banks, financial regulators and private sector entities.

In this year’s edition the forum will include well known speakers that will discuss the opportunities and challenges that are presented in today’s financial industry.

It will also tackle key topics including Fintech, Islamic Finance and Risk Management whilst taking pace with technological innovation, financial crimes and automation. The MEBF’s 7th edition, will take place on November 12, 2019 in Abu Dhabi’s Fairmont Bab Al Bahr hotel.