The Banking Executive Magazine- June 2026 Issue

UAE Banks UAE Banks STEP UP GENEROUS DEPOSIT OFFERS UAE banks are bolstering deposits by ratcheting up interest rates for new savers and rewarding clients who pay in their salaries. The UAE has worked hard over the past decades to establish itself as a global financial, business and tourism hub as part of largely suc- cessful efforts to diversify its previ- ously oil-dependent economy. Its domestic banks are, however, now finding their predominance threatened by tech-savvy digital up- starts with lower overhead costs. The central bank told Reuters the raft of new offers from the country's banks were normal market activity to attract retail deposits and provide loans. Fadi Zoghby, Dubai-based partner at consulting firm McKinsey, said the conflict may have made stable retail deposits more valuable for banks. The timing is notable, but I would not call this a sudden war-driven de- posit scramble, he said. SWEET DEALS FOR NEW DEPOSITS Dubai's largest bank Emirates NBD is offering up to 5% per annum for customers holding or opening a Saver Plus account in dirhams be- tween April 1 and June 30 and de- positing new funds. Dubai Islamic Bank is marketing up to 6.6% interest annually for cus- tomers who open an account in dirhams or dollars between June 1 and August 31 and transfer a monthly salary of at least 10,000 dirhams ($2,722.79) while maintain- ing a minimum average balance of 50,000 dirhams. National Bank of Fujairah is also of- fering up to 6.25% per annum on new dirham saving accounts opened before July 31, provided a salary is regularly deposited. The rates are all significantly above the central bank's 3.65% base rate. The UAE's dirham currency is pegged to the dollar, and its central bank generally follows U.S. Federal Reserve interest rate policy. Emirates NBD and DIB declined to comment, while NBF was not imme- diately available for comment. Zoghby said the offers were part of an existing competitive trend as pres- sure from digital lenders has pushed banks to respond not with a generic race for deposits but rather tailored offers aimed at becoming a cus- tomer's primary bank. BANKS RESILIENT FOR NOW, BUT EYES ON SECOND QUARTER Banks including Emirates NBD, First Abu Dhabi Bank and Abu Dhabi Commercial Bank all reported a rise in deposits in the first quarter after a strong start to the year. But second- quarter figures will be closely watched by investors as the impact of the war starts to become clearer. UAE banks liquidity indicators dete- riorated somewhat in March-early May, Bank of America analysts said last month, while adding there were no signs of stress. ISSUE 210 JUNE 2026 the BANKING EXECUTIVE 39