UAE banks' reserve requirements picked up 7.7 per cent during the first quarter (Q1) of 2020 to Dh132.6 billion ($36 billion) as compared to the corresponding period in 2019, a media report said.

The required reserves have been steadily growing over the recent months, reported state news agency Wam, citing statistics released by the Central Bank of the UAE (CBUAE).

In December 2019, they increased to Dh129.7 billion from Dh126.2 billion in September same year.

In January 2020, the required reserves climbed to Dh130.8 billion, edging down to Dh130.1 billion in February, before rebounding to Dh132.6 billion in March.

Earlier this month the CBUAE reduced banks’ reserve requirements for demand deposits by 50 pct to support the country’s economy during the COVID-19 pandemic. This will inject liquidity of about Dh61 billion, which can be used to support banks’ lending to the UAE economy and their liquidity management.

The CBUAE has further extended the duration of the Targeted Economic Support Scheme, TESS, for affected retail and corporate customers and made other enhancements to the scheme. Banks and finance companies participating in the TESS programme will be able to extend to their customers’ deferrals of principal and interest until 31 December 2020. – TradeArabia News Service