A quarterly survey by the United Arab Emirates central bank showed a downtrend in overall credit appetite for both business and personal loans, the central bank said on Thursday.
The net balance measure for business lending – the weighted percentage of respondents reporting an increase in demand for loans minus those reporting a fall in demand – fell to minus 2.3 for the September quarter from plus 3.1 in the previous quarter.
For the December quarter, however, respondents expect the net balance measure to rebound to plus 7.9, indicating demand for business loans is projected to increase.
The survey showed banks’ credit standards tightened further during the September quarter, with the effect particularly pronounced for smaller firms, and this tightening is expected to continue more slowly in the current quarter, the central bank said.
Earlier this year, demand for credit in the United Arab Emirates rebounded in the January-March quarter, a survey conducted then revealed.