The Central Bank extends the measures of the economic support plan aimed at supporting the recovery of the economy in the post-Corona stage

The Central Bank of the United Arab Emirates extended several measures included in the targeted comprehensive economic support plan with the aim of supporting the continuous recovery of the country's economy. 

Accordingly, the precautionary measures regarding capital reserve requirements, liquidity and requirements for stable funding sources for banks will be extended for a period of six months, until the end of June 2022. All banks operating in the country will be able to take advantage of these measures to support a balanced and sustainable recovery. The capital reserve measures will include a temporary reduction of the capital maintenance margin and the capital reserve established for systemically important local banks. As for the liquidity measures, they consist of a temporary prudential reduction in the liquidity coverage ratio, the ratio of eligible liquid assets, the ratio of net stable funding, and the ratio of advances to stable resources. 

The Central Bank announced earlier this year that the program of deferring loan installments, which was included in the targeted comprehensive economic support plan, will expire on December 31, 2021, which is the first stage of the Central Bank’s strategy for a gradual exit from the measures that have been applied during the pandemic.

The support plan program to support new lending and financing will continue until June 30, 2022. 

The Central Bank’s strategy for a gradual exit from the directed comprehensive economic support plan will ensure a balance between lifting measures on the one hand, and a continued commitment to supporting the recovery witnessed by the country’s economy on the other.

Additional support measures introduced during the pandemic include reduced mandatory reserve requirements and a reduction in the down payment for new mortgage loans, and will remain in effect temporarily. 

In this regard, His Excellency Khalid Muhammad Balama, Governor of the Central Bank, said: “The targeted comprehensive economic support plan has proven its effectiveness in supporting the financial system of the UAE and the national economy throughout the pandemic period. With the economic recovery gaining remarkable momentum, the Central Bank modified the support plan, so that Measures designed to reduce the immediate negative effects of the pandemic have been replaced by targeted measures to support economic recovery.  

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