MEMPHIS REISEN

NBE, Banque Misr raise EGP 565bn from high-interest certificates in one month – Dailynewsegypt

The National Bank of Egypt (NBE) and Banque Misr have raised EGP 565bn from the sale of savings certificates with 23.5% and 27% annual returns until last Thursday.

Banque Misr’s Chairperson Mohamed El-Etreby said that his bank sold certificates worth EGP 200bn, while a source at NBE said that his bank sold certificates worth EGP 365bn.

On 3 January, NBE and Banque Misr issued new certificates for one year with an annual return of 27% payable at maturity, or an annual return of 23.5% payable monthly.

The new certificate is available in multiples of EGP 1,000 for both Egyptian and foreign individuals, including minors.

Interest is calculated from the day after the purchase of the certificate. It is also possible to borrow against the certificate during its term. The certificate cannot be redeemed before six months from the next working day after the purchase. The certificate is redeemed at its face value at the end of its term, or earlier as the bank decides.

To prevent borrowing operations to buy these certificates, the Central Bank of Egypt (CBE) required banks to ensure that the interest rate on loans secured by these certificates is not less than 24%.

Banks have noticed some customers taking loans secured by some of their savings instruments with an interest rate above 2% and reinvesting those loans in the 23.5% and 27% certificates.