Egyptian Banks Attract $1.1 Billion in Foreign Currency Deposits

Total deposits in foreign currencies in Egyptian banks increased by $1.1 billion last February, according to recent data issued by the Central Bank of Egypt.

Data showed that customer deposit balances in foreign currencies rose to $50.8 billion last February, compared to $49.7 billion in the previous January.

The increase in foreign currency deposits last February was the highest ever, and came in conjunction with Egypt signing the largest investment deal with the UAE, worth $35 billion, to develop the city of Ras El Hekma.

An official at one of the banks said that the increase in customer deposits in foreign currencies last February was due to several reasons, including the cessation of speculation and the decline in the dollar exchange rate in the parallel market at significant rates during the second half of February and before the devaluation of the pound, which prompted customers to keep their savings in banks again.

He explained that there is a noticeable demand for customer subscriptions to savings pots in dollars to keep their foreign portfolios and benefit from the interest on them in the same currency, noting that the large increase in foreign balances is an indication of customers regaining confidence in official dealings with banks, especially in conjunction with the signing of the Ras al-Hikma deal, which greatly supported help Solve the currency crisis.

Deposits in foreign currencies in banks are divided between demand deposits, which amounted to about $12.7 billion, and time deposits and savings certificates, whose value rose to $35.8 billion at the end of last month.

Before the end of February, Egypt received the first tranche of the Ras al-Hikma deal amounting to $5 billion, then received the second tranche worth $5 billion in early March, in addition to settling Emirati deposits owed to Egypt worth $5 billion.

Egyptian Prime Minister Mostafa Madbouly said a few days ago that the second batch of financial dues for the project will be received within the next few weeks.

The net foreign assets deficit of the banking sector decreased by about $7 billion during the month of February, falling to $21.94 billion, compared to about $28.98 billion last January.