UAE Central Bank urges banks to help private companies, SMEs, individuals

Banks expressed their willingness to participate in the TESS

General view of the Central Bank of UAE on January 3, 2017

General view of the Central Bank of UAE on January 3, 2017

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The Central Bank of the UAE (CBUAE) has urged banks to support private sector corporates, SMEs and individuals affected by the coronavirus pandemic.

At a meeting with the CEOs of banks operating in the country, the governor of the CBUAE discussed measures implemented under the Targeted Economic Support Scheme (TESS).

“We urge banks and financial institutions to act in the best interest of retail clients, private sector corporates and SMEs, which are the growth engine of our economy,” Abdulhamid Saeed, Governor of the CBUAE said.

Banks yet to confirm their participation in the TESS were called upon to do so at the earliest to protect the economy.

The aggregate value of all capital and liquidity measures adopted by the Central Bank under the TESS amounts to 256 billion dirhams ($69.7 billion), a statement by the CBUAE said.

Since the launch of the TESS on March 14, 10 billion dirhams has been provided to banks in the form of zero-interest funding, while over 61 billion dirhams was provided in the form of lowered-cash-reserve requirements, which are to be deployed to directly benefit companies and consumers who have been adversely impacted by the pandemic.

At the meeting, the CEOs confirmed their decision to avail the benefits of TESS.

“It is encouraging to see that banks operating in the UAE are drawing upon the Targeted Economic Support Scheme to support the liquidity needs of their customers, as we aim to cushion the economic impact of the pandemic on companies as well as individuals,” Saeed said.

“I am confident that the Scheme will act as a catalyst to strengthen economic activity and effectively mitigate financial risk, while also ensuring that the businesses are prepared for the post-COVID-19 era,” Saeed added.

The CBUAE will be reaching out to the banks during the coming days to better understand how they plan to serve the objectives of TESS and help their customers to cope with the consequences of the coronavirus pandemic, the statement said.

The UAE had announced 387 new cases of coronavirus on Sunday, bringing the total number of registered cases in the country to 4,123.

(Writing by Gerard Aoun, editing by Seban Scaria)


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