The UAE’s banking sector wrapped up 2025 on a high note, adding more than AED780 billion in assets over the year and pushing the system’s total size to roughly AED5.34 trillion by December, up from about AED4.56 trillion a year earlier.
Figures released by the Central Bank of the UAE show momentum carrying through to the final month of the year. Gross banking assets climbed 1.7% in December alone, rising from AED5.25 trillion at the end of November to AED5.34 trillion.
Credit expansion remained steady. Gross lending increased 1.5% month-on-month to AED2.57 trillion. Foreign-currency lending did most of the heavy lifting, accounting for roughly two-thirds of the growth, while domestic credit made up the rest.
Within the local market, lending to the private sector edged higher, contributing the bulk of domestic credit growth. Financing to government-related entities also picked up, alongside a sharp jump in credit extended to other financial corporations.
Deposits moved in step with lending. Total bank deposits rose 2.2% in December to AED3.31 trillion. Resident deposits continued to form the backbone of funding, growing to just over AED3.0 trillion, while non-resident deposits surged at a faster pace, reflecting rising cross-border flows.
Private sector deposits led the gains among residents, followed by stronger balances from government-related entities and other financial corporations. Government deposits, however, declined during the month.
Liquidity indicators also pointed to expansion. Narrow money (M1) increased 2.2% as both cash in circulation and demand deposits grew. Broader money supply measures followed suit, with M2 climbing 3.2% on the back of higher quasi-monetary deposits, particularly from corporates. The widest measure, M3, rose 1.2%, tracking the increase in M2.
The monetary base posted an even sharper rise, jumping 5.4% in December. This was driven by higher currency issuance and a surge in banks’ overnight balances held at the central bank, more than offsetting a decline in reserve accounts. Central bank bills and Islamic certificates of deposit were largely unchanged.
Taken together, the data underline a year marked by balance-sheet expansion, ample liquidity, and sustained credit growth—cementing 2025 as a standout period for the UAE’s banking system.
