Proceeds from the 25 percent and 22.5 percent saving certificates of deposit (CDs) offered by Egypt’s Banque Misr and the National Bank of Egypt (NBE) garnered 460 billion Egyptian Banks in less than a month.
This was disclosed by the Chairman of the Federation of Egyptian Banks and Banque Misr Mohamed El-Etreby.
Banque Misr and the NBE, Egypt’s biggest state-owned banks, as well as Banque du Caire, have announced that they will stop on Tuesday issuing the 25 percent annual yield CDs, which are also available with a monthly yield of 22.5 percent, less than a month after their issuance.
Meanwhile, Banque du Caire will continue to offer its Primo Gold Certificates of Deposit at an annual yield of 17.25 percent, a quarterly yield of 16.25 percent, and a monthly yield of 16 percent, the bank said on Monday.
The move to issue the new CDs aimed to tackle inflation and attract foreign exchange as the country has been hit by the ongoing global economic crisis sparked by the war in Ukraine.
The NBE and Banque Misr started issuing the certificates a few days before the Central Bank of Egypt (CBE) depreciated the local currency on 11 January for the third time in a year, which has sent the Egyptian pound to its lowest level on record against the US dollar. This is the highest return on saving certificates in Egypt.
In statements to Al-Hekayah TV programme on MBC Masr on Sunday, El-Etreby said the dollar-denominated resources have witnessed some improvement recently thanks to international institutions’ confidence in the Egyptian economy.
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Many individuals have sold US dollars for Egyptian pounds and bought CDs in local currency over the past month, which reflects the narrowing gap between official and parallel markets, El-Etreby noted.
Over the past year, Egypt has taken multiple measures to battle rising inflation and a shortage in foreign currency sparked by the global economic crisis.
The CBE is set to hold the first monetary policy meeting this year on Thursday with expectations that it will raise its overnight interest rates in the face of inflation.
In December, the Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) raised the interest rates by 3 percent (300 bps) for the fourth time since the start of the Russia-Ukraine war in February 2022.
