The Finance World Magazine| Edition: May 2023

UAE Banking News
UAE Banks Federation
hosted lecture by Global
Risk Management Expert
The lecture by Professor Edward
Altman, recently organised by
the UAE Banks Federation,
was a valuable opportunity for
executives and staff from UBF member
banks and financial institutions to
learn from a global expert in the
field of risk management. Professor
Altman discussed the phenomenon
of ghost companies, which manage
to continue operating despite their
inability to make profits or meet their
obligations. He also spoke about credit
risk management models and how
they can be applied to counter these
companies. In addition, Professor
Altman provided an overview of the
ZValue model, which has been used
by banks in more than 20 countries.
He also highlighted the evolution of
resilient capabilities by companies and
economic institutions in the current
credit cycle, and the factors that
contribute to determining the phases
of the credit cycle.
CBUAE cancels Abu Dhabi license of Russia’s
MTS Bank
On 31 March, 2023, the
Central Bank of the UAE has
announced the cancellation
of MTS Bank’s Abu Dhabi
branch license, a Russian bank that
had obtained a license to operate
in the UAE in 2022. The bank’s Abu
Dhabi operations will be wound down
within six months of the decision. The
decision was made after considering
the risks of sanctions associated with
the bank after its designation by the US,
UK and EU. During the winding down
period, the branch will be prohibited
from opening new accounts and
conducting transactions, except for
clearing prior obligations. The bank’s
use of Central Bank’s payment systems
will be restricted to this purpose only.
UAE issues new AED 1,000 banknote for circulation
The UAE Central Bank has
launched a new AED 1,000
banknote, made from ecofriendly
polymer material.
The banknote features cultural and
development symbols that represent the
UAE’s global achievements, reflecting its
position as a leader among developed
countries. The design also highlights
the UAE’s achievements in space
exploration, embodying its forwardlooking
vision and ambitions. The
banknote will be available at banks and
exchange houses, in alignment with the
UAE’s declaration of 2023 as the year of
sustainability. Khaled Mohamed Balama,
Governor of the UAE Central Bank, said
the banknote represents the new phase
of the UAE’s developmental journey and
ambitious future.
UAE set to be a leader in digital finance with CBDC
The UAE’s leadership has a strong
vision for digital transformation
and non-oil production. To
further diversify its economy,
the central bank is planning a Central
Bank Digital Currency (CBDC) - a digital
version of the UAE’s fiat currency, issued
and backed by the central bank. Unlike
decentralized cryptocurrencies, CBDCs
are created and maintained by a central
bank, responding to the rise of cashless
payments and providing greater access to
financial services. However, challenges
remain, such as ensuring cybersecurity
and data privacy, regulatory compliance,
and bridging the digital divide for
underserved populations. CBDCs would
allow for instant, secure transactions
without intermediaries.
14 www.thefinanceworld.com May 2023