DUBAI: The United Arab Emirates central bank aims to develop its monetary policy framework by launching a discount window to enable banks to borrow intra-day and overnight funds, it said on Monday.
"This facility will improve liquidity management practices within the UAE and support money markets if there are liquidity shortfalls," the central bank said in its inaugural financial stability review.
"It will also support the development of collateralised debt markets and long term capital markets as commercial banks will be inclined to invest in securities that are defined as eligible securities - this process will facilitate the implementation of Basel III liquidity standards," it said.
The central bank did not say exactly when it planned to launch the window, which will be called the "marginal lending facility".
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