Abu dhabi: The Central Bank of the UAE (CBUAE) has released its Financial Stability Report 2025, affirming the strength and resilience of the UAE's financial and banking system. The report highlights the robust performance of the banking sector, adequate capitalisation and liquidity, improved asset quality, and continued growth in credit, deposits, and profitability, amid the positive performance of the UAE economy.
According to Emirates News Agency, the report revealed that the total assets of the UAE banking system increased by 17.1 percent to AED5.3 trillion at the end of 2025. The loan portfolio expanded by 17.8 percent, driven primarily by increased domestic lending, particularly in the retail and private corporate segments.
The report indicated improvements in asset quality, with the non-performing loan (NPL) ratio declining to 3.3 percent in 2025, compared to 4.7 percent in 2024 and 8.2 percent in 2020. The UAE banking system maintained adequate capitalisation, with the Capital Adequacy Ratio (CAR) standing at 17.0 percent at the end of 2025, well above the minimum regulatory requirements.
The banking system's profitability remained strong, with net profits increasing by 11.7 percent to AED90.8 billion in 2025, supported by growth in total operating income. The system also sustained strong liquidity, aided by continued deposit growth.
The 2025 supervisory stress tests confirmed the banking sector's resilience to severe economic and financial shocks. Under the adverse scenario, the average Common Equity Tier 1 (CET1) capital ratio declined from 14.1 percent to 11.1 percent at its lowest point during the stress-test horizon, while remaining above the minimum regulatory requirements.
The report also underscored the resilience of other segments of the financial system, including the insurance sector and Islamic banking. It highlighted the continued development of the UAE's financial infrastructure and payment systems under the Financial Infrastructure Transformation (FIT) Programme, contributing to the efficiency and resilience of the financial system and supporting digital transformation.
Developments in payment systems, such as Aani, the Instant Payments Platform, and Jaywan, the UAE's national card payment scheme, were highlighted, alongside advancements in cross-border payments, further enhancing the efficiency and resilience of the UAE's financial infrastructure.
Khaled Mohamed Balama, Governor of the CBUAE, stated, "The Financial Stability Report 2025 affirms the strength and resilience of the UAE financial system and its ability to continue supporting the national economy efficiently, underpinned by adequate capital and liquidity, improved asset quality, and continued growth in credit, deposits, and profitability."
He added that the CBUAE will continue to strengthen its supervisory and prudential frameworks and enhance the financial system's preparedness to address future risks and challenges, contributing to safeguarding financial stability and supporting sustainable economic growth.