RIYADH: UAE Islamic banks saw their asset values rise to 703 billion dirhams ($191.4 billion) by the end of 2023 in what was an 11 percent annual increase, official data showed. Figures released by the Central Bank of the UAE revealed this was a jump from 630.7 billion dirhams in December 2022, marking a growth of 72.4 billion dirhams over 12 months. On a month-on-month basis, assets increased by 0.6 percent in December, totaling 4.2 billion dirhams compared to November’s 698.8 billion dirhams. Islamic banks follow Shariah principles, providing diverse financial services, including investments, and deposits, avoiding interest-based transactions, and upholding ethical standards. CBUAE has issued licenses to several fully-fledged Islamic banks, including Abu Dhabi Islamic Bank, Ajman Bank, and Al Hilal Bank. Additionally, BOK International Bank, Dubai Islamic Bank, Emirates Islamic Bank, and Sharjah Islamic Bank have also received licenses to operate in this sector. According to CBUAE’s data, credit extended by Islamic banks rose to 428.9 billion dirhams by December, up 7.82 percent annually from 397.8 billion dirhams. Meanwhile, deposits in such institutions witnessed a surge, reaching 495.3 billion dirhams by the end of 2023, reflecting a yearly growth of about 12.6 percent from 439.8 billion dirhams in December 2022. On a monthly basis, deposits increased by 0.9 percent compared to November 2023’s 491.1 billion dirhams. These banks saw their total investments reach 132.7 billion dirhams by December, marking a 27.1 percent, or or 28.3 billion dirhams, annual increase, while monthly investments rose by about 1 percent. The breakdown of these investments includes 100.4 billion dirhams in bonds held to maturity, 18.7 billion dirhams in financial instruments representing debt on others, and 2.6 billion dirhams in shares. This also encompasses 11 billion dirhams in other investments within the portfolio. In comparison, traditional banks operating in the UAE witnessed substantial growth in their total assets, reaching 3.3 trillion dirhams by the end of last year. This marked an 11 percent annual increase from 3 trillion dirhams, reflecting a rise of 335.2 billion dirhams over the year. By December, conventional banks comprised roughly 82.7 percent of the total assets of the country’s banking system, totaling 4 trillion dirhams, whereas Islamic banks held a 17.3 percent share. Meanwhile, conventional banks extended a total credit of 1.5 trillion dirhams by December, marking a 5.5 percent yearly increase, while deposits surged to 2 trillion dirhams. The total investments of conventional banks grew by 15.6 percent annually to 488.8 billion dirhams by December. This included 246.2 billion dirhams in financial instruments representing debt on others, 204.4 billion dirhams in bonds held to maturity, 13.2 billion dirhams in shares, and 37.9 billion dirhams in other investments.