Banks safe from subprime crisis, says UAE Central bank

11 November 2007
The Central bank of the UAE has said that country’s banking system had only “marginal exposure” to US subprime mortgage loans and that this exposure will not affect bank results for 2007.

Direct exposure to high-risk home loans in the US was limited to a small number of banks, who are not significantly exposed to assets that have dropped in price during the current financial crisis.

Most UAE banks have not reported any loses from the credit crunch, although Abu Dhabi Commercial Bank (ADCB) has said losses on its investment portfolio because of the subprime crisis reduced third quarter profit by $19 million.

Of the six largest banks in the country four have posted strong third quarter profits, in contrast to many Western banks which have had to wipe billions of dollars of their loan books because of falling assets prices.

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