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Egypt’s banks have highest liquidity rates in region

Egypt’s banks have highest liquidity rates in region

ArabFinance: Banks operating in the Egyptian markets have the highest rates of liquidity in the region, Ahram Online cited a bank official.

The announcement follows the Central Bank of Egypt’s decision to approve granting emergency liquidity for local banks.

The CBE's decision on providing emergency liquidity for national banks is a future procedure that may be put into effect in the future.

The provision of emergency liquidity for central banks is one of the tools used to support and help banks face liquidity crisis on the short term.

Earlier this week, the CBE approved a set of rules under which it would be able to provide emergency liquidity to local lenders.

Under the new rules, banks can apply to receive emergency liquidity if they cannot get it from the interbank or financial markets.

Emergency liquidity will be made available to solvent banks only and for a maximum period of 180 days.

It will be priced at a premium of at least 5% above the overnight lending rate, the statement added.

Egypt's banks are facing a deterioration in asset quality due to the economic impact of the pandemic. The economy eked out growth overall in 2020 and 2021, with the help of government support packages for the hardest-hit sectors.

 

 

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