The 6.9km stretch that normally takes 4 minutes to cross, is now taking motorists on the route up to 35 minutes
uae2 hours ago
“The Dubai government’s offer is better than expected for institutions that have exposure to Dubai World and Nakheel,” Al Khouri told reporters on the sidelines of a conference in the capital.
“It will have a positive impact on banks.”
Al Khouri said that the offer will result in very good effects on local banks, as well as foreign banks and financial institutions.
Last Thursday, Dubai announced that it would spend $9.5 billion to restructure its flagship conglomerate in a plan that offered to repay two key bonds and give lenders their money back in up to eight years.
Estimates of potential exposure of banks to Dubai World have ranged up to $15 billion.
On the issue of pumping more liquidity into the banking system to resume normal lending, Al Khouri said that the banks in the country have sufficient capital reserves to be able to withstand new economic shocks.
He said that there is no need for more liquidity for the nation’s banks and financial institutions.
“Banks have enough capital to face any crisis, if another one happens,” he said.
Al Khouri said earlier this month UAE banks were strong enough to absorb any shock, even from Dubai World’s restructuring, and no capital injection was needed for now.
The global financial crisis resulted in freezing credit markets and choked off lending in the country, leading to defaults as homeowners found it harder to repay their debts.
The UAE government, along with the Central Bank, has been very proactive in tackling the financial crisis, since they introduced a series of regulatory measures to shore up local banks’ balance sheets by setting up several specialised windows for banks and financial institutions to access liquidity in meeting their day-to-day banking operations.
The Ministry of Finance set up a Dh70 billion special facility in October 2008 to inject liquidity into the banking system by bolstering their capital adequacy ratios.
However, banks did not utilise all the funds made available to them, using only Dh50 billion with the remaining Dh20 billion still available at the Ministry, Al Khouri said in a recent statement.
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