UAE Banks Stuck with 50% Non-performing Loans
Non-performing loans are expected to swell almost 50 per cent to nearly Dh65 billion (US$17.69bn) this year as the global economic downturn and sagging property prices take a further toll on the country’s lenders.
The rise is likely to force lenders to set aside more reserves to protect themselves.
“Non-performing loans are already at a reasonable level,” Sultan Nasser al Suwaidi, the Central Bank Governor, said yesterday.
“If you take into account write-offs, non-performing loans would be higher.”…SOURCE
Non-performing loans were expected to rise to 6.5 per cent of bank lending this year from 4.4 per cent last year, he said. The total value of loans and advances in the UAE is Dh1 trillion, according to Central Bank statistics.
Banks’ loan books have been adversely affected by exposure to a severe correction in the country’s property sector, with estimated price declines of up to 50 per cent in Dubai and 40 per cent in Abu Dhabi.
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Tags: 50 Cent, Abu Dhabi, Al Suwaidi, Bank Loan, Central Bank Governor, Central Banks, Dubai, Economic Downturn, Higher Source, Lenders, Loan Books, Nasser, Non Performing Loans, Price Declines, Property Sector, Statistics, Sultan, Total Value, Trillion, Uae
