The Central Bank of the United Arab Emirates announced that, effective October 28, 2020, it will introduce new regulations regarding reserve requirements for licensed financial institutions that accept deposits. ...
The introduction of these regulations is the second step towards implementing the new dirham monetary framework announced earlier this year.
With the introduction of these new regulations, the maintenance of reserve needs balances will be more flexible, as the reserve maintenance period will be extended from 7 to 14 days to facilitate short-term liquidity management.
Moreover, licensed financial institutions that accept deposits will be permitted to withdraw their reserve balances held in the central bank on any day at a rate up to 100% for purposes of daily settlement or to deal with any fluctuations in money market rates for one night. ; Ensure that it meets the requirements of the daily average over a 14-day standby maintenance period.