UAE banks are in ‘good position’

The UAE Central Bank on Saturday declared a Dh3.7 billion net profit for the fiscal year 2011. Banks in the country are in a good position and should not be negatively impacted by the recent turmoil in international markets, the Central Bank said in a statement issued after the board of directors’ meeting.

The board also discussed drafts of financial laws and instructed introduction of some ‘major amendments’ to them. The board stressed that these laws should reflect the independence of the Central Bank and the independence of monetary policy, as per the international standards issued by the Financial Stability Board and Basle Committee standards.

One of the draft laws is Law No.10 of 1980 for the Central Bank, the monetary system and organisation of banking, while another laws pertains to the organisation of financial services, the Central Bank said without mentioning the suggested amendments.

The board meeting was chaired by Khalil Mohammed Sharif Foulathi and attended by Khalid Juma Al Majid, Deputy Chairman and Sultan bin Nasser Al Suwaidi, the Governor.

The board reviewed the audited annual accounts for the fiscal year 2011, and distribution of net profits at Dh3.7 billion. Initially it was approved that 55 per cent, or Dh2.03 billion, share of the federal government to be transferred to the Ministry of Finance. Twenty per cent to be transferred to Shaikh Zayed Housing Programme and remaining 25 per cent to the account of the Permanent Deposit of the Federal Government at the Central Bank.

Last month, the Central Bank announced that total bank deposits in the country reached Dh1.07 trillion by the end of 2011. Total bank loans and advances (net of provisions and interest in suspense) reported at Dh1.07 trillion and total bank assets declared at Dh1.66 trillion at the end of December 2011.

Furthermore, the board reviewed applications submitted by natural and juridical persons to establish companies and establishments to undertake financial activities and money changing business. The board approved the applications, which fulfill the terms as per the law and regulations, as applied to each business activity.

— abdulbasit@khaleejtimes.com