The Central Bank of Egypt (CBE) recently revealed that the aggregate financial position of banks operating within the local market (excluding CBE) reached EGP17.896 trillion ($373.1 billion) as of March 2024 compared to EGP14.2 trillion ($296.01 billion) in December 2023.
The net open foreign currency positions reached 5.7 percent of the total capital base at Egypt’s banks in March 2024, up from -1.6 percent in December. This ratio reached 6.8 percent at the 10 largest banks and 7.9 percent at the five largest banks. The central bank also emphasized that the total surplus or deficit in foreign currency positions should not exceed 20 percent of the capital base.
Banks’ balances and obligations
The central bank revealed that, on the asset side, cash balances in Egypt’s banks reached EGP175.964 billion, with interbank balances amounting to EGP3.181 trillion. In addition, banks’ balances with foreign banks reached EGP1.042 trillion.
Portfolios of securities and investments in treasury bills across Egypt’s banks reached EGP5.490 trillion, while other unspecified assets totaled EGP1.189 trillion.
As for liabilities, the central bank revealed that banks’ capital reached close to EGP449.610 billion while reserves amounted to EGP793.803 billion and provisions reached EGP448.678 billion.
Banks’ domestic interbank obligations in Egypt reached EGP1.543 trillion, while their foreign interbank obligations amounted to EGP565.69 billion. In addition, total deposits reached EGP11.425 trillion, while long-term bonds and loans amounted to EGP842.209 billion.
Non-performing loans
Egypt’s central bank also revealed that the ratio of non-performing loans (NPLs) in banks declined to 2.6 percent in March 2024, compared to 3 percent in December 2023. The data also revealed that NPLs made up 2.2 percent of total loans in Egypt’s 10 largest banks and 2 percent in the top five banks.
Banks made provisions reaching 86.3 percent of their total NPLs in March 2024, compared to 88.7 percent in December 2023. The provision coverage reached 90.8 percent in the country’s 10 largest banks, and 90.3 percent in the top five banks.
In addition, Egypt’s banks accumulated EGP793.803 billion in reserves, with the 10 largest banks holding EGP644 billion of these reserves, and the top five banks holding EGP559.2 billion.
The central bank also revealed a 46.2 percent decline in the private sector’s share of total loans granted by banks to their clients in March 2024 compared to 51.9 percent in December 2023.
Loan-to-deposit ratio rises
Egypt’s central bank reported a 59.9 percent increase in the loan-to-deposit ratio at banks in March 2024, up from 54 percent in December 2023. The ratio reached 59.7 percent at Egypt’s 10 largest banks and 62.3 percent at the five largest banks.
Notably, total customer deposits rose to EGP11.425 trillion in March 2024 from EGP10.137 trillion in December 2023. In March 2024, the deposit-to-asset ratio reached 63.9 percent, compared to 71.5 percent in December 2023.
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Capital base declines
The central banks also reported an increase in the average actual liquidity ratio in local currency at banks to 37.9 percent in March 2024 from 36.8 percent in December 2023.
In addition, banks’ investments in securities and treasury bills rose by EGP293 billion to around EGP5.490 trillion in March 2024.
Egypt’s banks saw a decline in the capital base to risk-weighted assets ratio to 18.1 percent in March 2024, down from 18.6 percent in December 2023. Meanwhile, the leverage ratio at Egypt’s banks increased to 7.3 percent in March, up from 6.9 percent in December.
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