Egypt: Banks to review interest rates on savings, loans after CBE’s 2% rate hike

Egypt: Banks to review interest rates on savings, loans after CBE’s 2% rate hike

The Assets and Liabilities Committees (ALCO), which are in charge of setting interest levels in banks, will start Sunday to adjust the interest rates on their savings and loan products following the Central Bank of Egypt (CBE)’s decision to raise interest rates by 2% at once last Thursday evening.

The Monetary Policy Committee (MPC) of CBE decided to increase the basic interest rates by 2%, making them 21.25% for deposits, 22.25% for lending, and 21.75% for the credit and discount rates and the main operation of CBE.

As an immediate reaction in the market, interest rates on variable-return certificates and some loan products linked to the interest rates rose by 2%.

There are several variable-return savings certificates in the Egyptian market, such as the National Bank of Egypt (NBE)’s “platinum” certificate and Banque Misr’s “Al-Qimma” certificate, as well as many variable-return loan products.

The market is also waiting for the CBE’s decision on the return on government debt instruments.

On behalf of the Ministry of Finance, CBE will issue today, Sunday, two treasury bills worth EGP 62bn, the first with a value of EGP 35bn for a term of 91 days, and the second with a value of EGP 27bn for a term of 364