DUBAI - The United Arab Emirates central bank (CBUAE) on Tuesday ​unveiled a package to ⁠help bolster banks' liquidity, marking its most significant policy move since the pandemic, as Gulf economies move to ‌weather the impact of the Iran crisis.

UAE banks, whose stocks have seen double-digit losses since the war began last month, jumped on ​Wednesday morning, with Dubai's Emirates NBD and Abu Dhabi Islamic Bank gaining over 6%, and Abu Dhabi Commercial Bank up over 5%.

First Abu Dhabi ​Bank was ​losing around 1% by 0825 GMT.

The war, now in its third week and withoutan end in sight, has thrown global energy markets and transport into chaos as the conflict has spread, with multiple attacks ⁠on Dubai and other countries across the Gulf.

Regional lenders, which in recent years benefited from rising credit demand as governments invest to diversify their economies, have proved resilient, but they are being severely tested.

The UAE's financial system "has demonstrated resilience during the current extraordinary circumstances affecting the global and regional markets without any material impact on the banking sector's health and payment ​systems," the CBUAE ‌board said in a ⁠statement.

Under the package approved ⁠on Tuesday, banks will gain enhanced access to reserve balances of up to 30% of the cash reserve requirement and term ​liquidity facilities in both UAE dirhams and U.S. dollars, the CBUAE said.

Other measures include ‌stopgap relief in liquidity and stable funding ratios as well as the ⁠temporary release of the countercyclical capital buffer (CCyB) and capital conservation buffer (CCB), it said.

"We think this news should be positive for sentiment near term as it provides temporary liquidity and capital relief for the banks in what is a difficult period," Goldman Sachs analysts said in a note.

They said that the temporary lifting of CCyB and CCB could boost capital buffers by up to three percentage points, giving lenders flexibility to keep writing loans and potentially absorb potential losses if asset quality deteriorates over the near-to-medium term.

While the measures introduced on Tuesday are larger than a similar package introduced to withstand the impact of the COVID-19 pandemic, "asset quality pressures could still emerge should the conflict persist ‌and its economic effects deepen," the bank said.

Gulf banks could face domestic deposit ⁠outflows of $307 billion if the Middle East conflict deepens, S&P Global Ratings said in ​a report on Monday. The ratings agency said, however, that it had seen no evidence of major outflows of foreign or local funding from banks.

The CBUAE said in Tuesday's statement that the overall stock of liquidity held by UAE banks at ​the regulator, combined ‌with their net eligible assets for central bank operations, had reached close to $250 billion, of ⁠which banks' reserve balances exceed $109 billion.

(Reporting by Federico ​Maccioni, Writing by Muhammad Al Gebaly, Editing by Franklin Paul, Rod Nickel and Pooja Desai)