The Nationwide Financial institution of Egypt (NBE) and Banque Misr have raised EGP 565bn from the sale of financial savings certificates with 23.5% and 27% annual returns till final Thursday.
Banque Misr’s Chairperson Mohamed El-Etreby mentioned that his financial institution bought certificates price EGP 200bn, whereas a supply at NBE mentioned that his financial institution bought certificates price EGP 365bn.
On 3 January, NBE and Banque Misr issued new certificates for one yr with an annual return of 27% payable at maturity, or an annual return of 23.5% payable month-to-month.
The brand new certificates is accessible in multiples of EGP 1,000 for each Egyptian and overseas people, together with minors.
Curiosity is calculated from the day after the acquisition of the certificates. Additionally it is attainable to borrow towards the certificates throughout its time period. The certificates can’t be redeemed earlier than six months from the following working day after the acquisition. The certificates is redeemed at its face worth on the finish of its time period, or earlier because the financial institution decides.
To stop borrowing operations to purchase these certificates, the Central Financial institution of Egypt (CBE) required banks to make sure that the rate of interest on loans secured by these certificates shouldn’t be lower than 24%.
Banks have observed some clients taking loans secured by a few of their financial savings devices with an rate of interest above 2% and reinvesting these loans within the 23.5% and 27% certificates.
