"S&P"UAE banks continue to benefit from the strength of the local economy in 2025

2025/01/09 8:45:36 PM

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Dubai, January 9 / WAM / S&P Global, the credit rating agency, said that UAE banks have benefited from the strong economy, which has led to an improvement in asset quality standards, stressing that this will continue during the year 2025.
In the report, “Expectations of the UAE Banking Sector for the Year 2025,” the agency expected that UAE banks would maintain stable and strong capital margins and strong financing conditions.
Speaking about economic growth, she expected real GDP growth to remain strong in 2025, as pro-business regulations, low corporate taxes, visa facilitation, the success of long-term residency visas, and support for the establishment of new companies in the country will continue.
The agency indicated that it expects continued strong lending growth in 2025, supported by continued monetary policy easing and a supportive economic environment.
According to the agency, banks have witnessed a noticeable increase in deposits over the past three years, which will support their strong growth momentum.
It is expected that the profitability of UAE banks will remain high, albeit at levels lower than the peak they reached in 2023.
She said that banks will maintain their strong efficiency thanks to rationalizing the use of branches, transferring employees to less expensive external locations, and increasing digital transformation, which will contribute to enhancing profitability.
UAE banks’ financing structures benefit from strong core client deposit bases and limited reliance on external financing.