The UAE’s banking leadership has pushed back against concerns that the ongoing Iran conflict is triggering an exodus of money from the Gulf financial hub, insisting liquidity conditions remain stable and dollar availability is intact.
Speaking during a media briefing, UAE Banks Federation chairman Abdul Aziz Al Ghurair dismissed speculation that investors or wealthy residents were rapidly shifting funds out of the country as geopolitical tensions intensify across the region.
“There is movement in both directions,” Al Ghurair said, indicating that outgoing and incoming capital flows continue to balance each other out. “There’s no reason for alarm.”
The remarks come as global investors closely monitor the economic fallout from the US-Israel conflict with Iran, a confrontation that erupted earlier this year and rattled energy markets across the Middle East. While parts of the Gulf banking network experienced temporary operational disruptions during the peak of hostilities, regional financial systems have largely stabilised since a ceasefire was reached last month.
The UAE, which has spent years positioning itself as a magnet for international wealth, entrepreneurs and institutional investors, appears determined to project confidence. Dubai and Abu Dhabi have continued to benefit from their low-tax environment, business-friendly regulations and strategic location linking Asian and Western markets.
Al Ghurair also struck an optimistic tone on the health of the banking sector itself, forecasting stronger second-quarter performance compared with the same period last year. He suggested lenders are unlikely to see a meaningful rise in corporate loan defaults despite the uncertainty created by the conflict.
According to him, the sector remains resilient enough to absorb regional shocks without significant strain on balance sheets.
The comments arrive as the UAE explores a potential currency swap arrangement with the United States — a move that would place it among a select group of economies with direct liquidity access arrangements involving the US Federal Reserve system.
Such swap lines allow central banks to exchange currencies directly, helping ease pressure on foreign exchange markets while lowering transaction risks for trade and cross-border investment activity.
Officials in the UAE have framed the discussions as part of broader efforts to deepen financial integration with global markets rather than as a response to any immediate liquidity crunch.
Al Ghurair additionally rejected suggestions that the country is facing a shortage of US dollars, reinforcing the message that domestic financial conditions remain comfortably supported despite regional instability.
