The Central Bank of the United Arab Emirates (UAE) has issued a new regulation designed to develop specialised banks that are obligated to provide services solely to UAE nationals and residents.

The specialised banks can only operate using dirhams, the currency of the UAE.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

The banks are mandated to follow unique banking rules designed specifically to serve the local residents. The rules cover account opening, card issuance, and retail and wholesale lending.

The regulation, which includes licensing, prudential and conduct requirements for the specialised banks, sets a minimum paid-up capital requirement of AED300m (£60m).

It also sets the total consolidated assets of specialised banks which shouldn’t exceed AED25 billion.

The regulation allows the specialised banks to practice different financial activities to serve the local community, such as account opening, card issuance, and retail and wholesale lending.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Operating in a “robust and prudent manner”

The objective of the new regulation is to provide a regulatory framework in which specialised banks can operate in the UAE financial sector in a “robust and prudent manner”, the central bank said in a statement.

It added that specialised banks must conduct their activities in UAE dirhams only and operate according to a low credit risk model.

They can be established either as a conventional specialised bank without Islamic windows or as an Islamic specialised bank, the central bank said.

The central bank stressed the importance of specialised banks’ compliance with all regulations, standards, and notices issued for the banking sector. They are only exempt from specific provisions contained in the new regulation which apply to specialised banks alone.