His Excellency Mubarak Rashed Al Mansoori, governor of the Central Bank of the United Arab Emirates discusses the impact of de-risking, anti-money laundering measures as well as the decline in oil prices on the gulf state’s economy and financial markets.
April 07, 2016 | The Banking ConversationEmmanuel Daniel (ED): There is a lot of interest from the international community in the way the UAE is responding to the global economic crisis, specifically in de-risking, dollar-clearing and AML. What is the Central Bank’s opinion on these issues?
Mubarak Rashed Al Mansoori (MR): When we look at the current economic situation it is with a vision towards actionable objectives. The vision is in line with the UAE government’s medium to long term plan which has emphasis on the health care and educational sectors to make these industries more cost effective while providing enhanced service.
The objectives of the Central Bank revolve around diversification of the economy, which will rely less on oil going forward. The Central Bank plays a critical role in promoting monetary and financial stability through sustainable economic growth with more emphasis on this in the coming years.
ED: Given the goal of diversification of the economy, what are the tactical responsibilities assigned to the Central Bank?
MR: The primary task is to ensure financial stability, supervising and regulating the banking sector while ensuring the banks retain a strong capital adequacy ratio. What we will do differently going forward is to encourage more growth within the private sector. This will be bank driven and will also focus on the small and medium size enterprises (SME) sector. In order for the economy to grow and diversify there needs to be further focus on the private and SME sector.
ED: This is exactly the sector that is being underserved at the moment. What do you think the problem is and what do you think needs to be done?
MR: There is not a problem but lack of incentives as banks are not incentivized to lend to the private sector or SME sector as they are perceived to be risky investments. There are many administrative issues surrounding these sectors and the banks would rather de...
Categories:
Risk and Regulation, Transaction BankingKeywords:GCC, UAE, Anti-money Laundering, Economic Crisis, SME, NPL, Basel III, Deposits
His Excellency Mubarak Rashed Al Mansoori, governor of the Central Bank of the United Arab Emirates discusses the impact of de-risking, anti-money laundering measures as well as the decline in oil prices on the gulf state’s economy and financial markets.
April 07, 2016 | The Banking ConversationEmmanuel Daniel (ED): There is a lot of interest from the international community in the way the UAE is responding to the global economic crisis, specifically in de-risking, dollar-clearing and AML. What is the Central Bank’s opinion on these issues?
Mubarak Rashed Al Mansoori (MR): When we look at the current economic situation it is with a vision towards actionable objectives. The vision is in line with the UAE government’s medium to long term plan which has emphasis on the health care and educational sectors to make these industries more cost effective while providing enhanced service.
The objectives of the Central Bank revolve around diversification of the economy, which will rely less on oil going forward. The Central Bank plays a critical role in promoting monetary and financial stability through sustainable economic growth with more emphasis on this in the coming years.
ED: Given the goal of diversification of the economy, what are the tactical responsibilities assigned to the Central Bank?
MR: The primary task is to ensure financial stability, supervising and regulating the banking sector while ensuring the banks retain a strong capital adequacy ratio. What we will do differently going forward is to encourage more growth within the private sector. This will be bank driven and will also focus on the small and medium size enterprises (SME) sector. In order for the economy to grow and diversify there needs to be further focus on the private and SME sector.
ED: This is exactly the sector that is being underserved at the moment. What do you think the problem is and what do you think needs to be done?
MR: There is not a problem but lack of incentives as banks are not incentivized to lend to the private sector or SME sector as they are perceived to be risky investments. There are many administrative issues surrounding these sectors and the banks would rather de...
Categories:
Risk and Regulation, Transaction BankingKeywords:GCC, UAE, Anti-money Laundering, Economic Crisis, SME, NPL, Basel III, Deposits