Tuesday, Nov 26, 2013
Dubai: The UAE will work towards a mechanism to provide credit to small and medium enterprises (SME) outside the banking system, Sultan Bin Nasser Al Suwaidi, Governor of the UAE Central Bank, said on Tuesday.
“We are looking at various options to provide credit to this key segment of the economy outside the banking system. SME financing is very important in job creation and we need to pay special attention to this segment,” said Al Suwaidi at the Middle East Banking Forum organised by the UAE Banks Federation.
The governor said the central bank is keen on developing priority sector lending to support economic and social development while improving financial inclusion in the country.
Domestic debt market
The central bank governor said, as part of the financial sector development in the country, creation of domestic debt market is a national priority. “Large companies and government related entities need alternative source of long-term funding other than bank financing. Banks also require funding to meet their capital requirements under Basel III. In this context, there is an urgency to create a local bond market,” said Al Suwaidi.
While there is no time frame set for the creation of a local debt market, Al Suwaidi said discussions are taking place at the highest levels and all stakeholders in the market are involved in these parleys.
Commenting on the upcoming maturity of Dubai’s $10 billion bond placed with the central bank, the governor said it is up the board of the bank to decide on any potential roll-over.
By Babu Das Augustine Deputy Business Editor
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