National Bank of Abu Dhabi (NBAD) has shut its equity market-making operation less than a year after launch, two sources aware of the matter said on Monday, in a blow to efforts aimed at boosting liquidity on the emirate's stock market.

The United Arab Emirates' largest lender by assets was the Abu Dhabi exchange's only official market-maker, quoting both buying and selling prices to make it easier for investors to move in and out of positions, after a February launch that the head of the 373 billion dirham ($101.6 billion) bourse said would increase liquidity and trading.

Since then, however, regional markets have been hit by substantial volatility and trading volumes have fallen away as investor sentiment has wavered because of weak oil prices, and Reuters reported in November that Galen Moore, the head of NBAD's equity market-making, had left the bank.

NBAD, which is almost 70 percent owned by an Abu Dhabi state fund, scrapped the equity market-making business at the end of 2015, the two sources said on Monday, speaking on condition of anonymity because the information had not been made public.

One of the sources said that the move was because the venture had proved unprofitable.

The scrapping of the operation comes as banks in the UAE are evaluating costs in response to the fall in oil prices, which has squeezed liquidity in the system and placed question marks over future earnings growth prospects.

Asked whether NBAD had closed its market-making business, Chief Executive Alex Thursby told Reuters: "We are focusing on debt capital markets more than equities because we don't think it is a natural place to play for us. We are less an equity house and more a debt house."

Thursby declined to elaborate on his comments.