The monetary and banking indicators in the UAE continued to show positive performance at the start of 2026, with total banking assets increasing by 1.4%, surpassing AED 5.413 trillion by the end of January 2026. This is compared to approximately AED 5.339 trillion at the end of December 2025, according to the Central Bank’s report on monetary and banking developments for January.
Total credit rose by 1.1%, reaching over AED 2.598 trillion at the end of January 2026, up from around AED 2.57 trillion at the end of December. This growth was supported by an increase in local credit, which amounted to AED 27.9 billion.
The rise in local credit was primarily due to a 2.5% increase in credit extended to the government sector and a 0.6% increase for the private sector, together contributing about 0.4 percentage points to overall growth. Conversely, a decline in credit extended to other financial institutions by 5.7% negatively impacted this growth, contributing approximately -0.1 percentage points.
Regarding deposits, total bank deposits grew by 0.9%, reaching around AED 3.337 trillion by the end of January 2026, up from AED 3.307 trillion at the end of December. This increase was bolstered by a 1.2% rise in resident deposits, which accounted for AED 3.046 trillion, while non-resident deposits fell by 2.4% to AED 290.7 billion, contributing -0.2 percentage points to overall deposit growth.
The data indicated growth in most components of resident deposits, with private sector deposits increasing by 1% to approximately AED 2.273 trillion, government-related entity deposits rising by 3.5% to AED 306.7 billion, and government sector deposits climbing by 2% to AED 401.3 billion. In contrast, deposits from other financial institutions decreased by 6.7%, stabilizing at AED 65.3 billion.
The monetary base also saw a 0.6% increase, reaching AED 900.8 billion at the end of January 2026, compared to AED 895.7 billion at the end of December, driven by a 32.4% rise in reserve accounts and a 1.7% increase in currency issued, despite a significant drop of 55.9% in current accounts of banks and other financial institutions as well as overnight deposits with the central bank.
According to the report, the money supply “M1” grew by 0.9% to AED 1.081 trillion at the end of January 2026, compared to AED 1.071 trillion at the end of December. This was a result of a 2.7% increase in currency in circulation and a 0.6% rise in demand deposits.
Similarly, money supply “M2” increased by 1.3% to around AED 2.79 trillion, supported by a growth of AED 25.3 billion in quasi-monetary deposits. Both corporate and individual deposits contributed approximately 0.5 percentage points each to the overall growth, with monthly increases of 0.9% and 1.5%, respectively.
Deposits from government-related entities experienced a growth of 3.6%, contributing about 0.4 percentage points to the overall expansion of money supply “M2”, supported by increases in demand and savings deposits in dirhams. Conversely, the decline in deposits from financial corporations, which fell by 7.1% due to a reduction in savings deposits in foreign currencies, limited this growth.
The “M3” money supply rose by 1.4%, exceeding AED 3.301 trillion by the end of January 2026. This growth was bolstered by the increase in “M2” and a 2.2% rise in government sector deposits, which reached AED 511.7 billion, contributing approximately 0.3 percentage points to the overall growth.
Additionally, the data revealed that the Central Bank’s foreign assets surpassed AED 1.084 trillion by the end of January 2026, compared to AED 1.058 trillion at the end of December 2025.
As of the end of January, the composition of the Central Bank’s foreign assets included AED 285.5 billion in bank balances and deposits with overseas banks, AED 740.9 billion in foreign securities, and AED 58 billion in other foreign assets.
The Central Bank’s balance sheet exceeded AED 1.119 trillion, which was distributed into liabilities and capital, with AED 533.4 billion in current accounts and deposit accounts, AED 306 billion in monetary bills and Islamic certificates of deposit, AED 177.4 billion in issued banknotes and coins, and AED 24.9 billion in other liabilities, while total capital and reserves amounted to AED 77.6 billion.
On the asset side of the Central Bank’s balance sheet, AED 224.2 billion was allocated to cash and bank balances, AED 76.2 billion to deposits, AED 767.6 billion to investments, and AED 51.3 billion to other assets.