The UAE and Bahrain Sign a $5.3 Billion Currency Swap Agreement

(The agreement is for a period of five years )

The UAE and Bahrain Sign a $5.3 Billion Currency Swap Agreement

The Central Bank of Bahrain announced on Wednesday that it had signed a currency swap agreement with the Central Bank of the UAE, with a nominal value of 2 billion Bahraini dinars ($5.3 billion), for a period of five years.

Currency swaps allow each central bank to obtain the other country's currency without resorting to foreign exchange markets, thus reducing transaction costs and exchange rate risks for cross-border trade and investment.

The agreement was signed by His Excellency Khalid Mohammed Balama, Governor of the Central Bank of the UAE, and His Excellency Khalid Ibrahim Humaidan, Governor of the Central Bank of Bahrain, with the aim of strengthening financial cooperation between the two countries, according to the Emirates News Agency (WAM).

The Governor of the Central Bank of the UAE, Khalid Mohammed Balama, stated that this agreement underscores the UAE and Bahrain's commitment to expanding financial and monetary cooperation and supporting trade and investment relations. 

He added that it also reflects the two sides' commitment to promoting the use of local currencies and developing frameworks for cooperation between central banks, which contributes to consolidating financial stability and deepening regional and international partnerships. 

For his part, the Governor of the Central Bank of Bahrain, Khalid Ibrahim Humaidan, stated that this agreement reflects the strong and deep-rooted relations between the leaderships of the Kingdom of Bahrain and the United Arab Emirates. 

He added that it represents a significant milestone in advancing bilateral relations between the two brotherly countries across various fields, and contributes to strengthening cooperation between central banks, supporting regional financial integration, economic growth, and financial stability.