UAE Central Bank doubles Covid stimulus package

dubai — The UAE Central Bank on Sunday doubled its stimulus package size to Dh256 billion from the Dh126 billion announced last month in order to improve liquidity in the banking sector and mitigate the impact of coronavirus on the economy as a whole.

The apex bank also halved local banks’ cash reserve requirement, which will allow them to release more funds to individuals and small and medium businesses in the coming months to overcome credit crunch.

The new funds now consist of Dh50 billion capital buffer relief, Dh50 billion funds available at zero cost to extend finance, Dh95 billion to ensure enough liquidity in the market and a Dh61 billion reduction of cash reserve requirements.

dubai — The Central Bank of the UAE on Sunday doubled the size of its stimulus package to Dh256 billion and allowed banks and finance companies in the country to extend deferrals of principal and interest payments to their customers until December 31, 2020.

On March 15, the central bank had announced a Dh100 billion stimulus package, which allowed banks to grant temporary relief on retail and business clients’ for loans payment of up to six months.

The regulator also took another major step on Sunday, halving the reserve requirement for demand deposit of all banks from 14 per cent to 7 per cent in order to increase liquidity in banking sector and mitigate the impact of coronavirus. This step will release Dh61 billion additional liquidity for the banking sector.

The apex bank also doubled its stimulus package from Dh126 billion to Dh256 billion since March 15. The new funds now consist of Dh50 billion capital buffer relief banks, Dh50 billion funds available at zero cost to extend finance, Dh95 billion to ensure there is enough liquidity in the market and Dh61 billion reduction of cash reserve requirements.