Egyptian Banks Cut Interest Rates on Savings Certificates

In a swift response to the Central Bank of Egypt’s recent decision to cut interest rates, two of the country’s largest state-owned banks, the National Bank of Egypt and Banque Misr, have announced significant revisions to the interest rates on their savings certificates in both Egyptian pounds and U.S. dollars. 

The new rates will come into effect on Monday, September 1.

National Bank of Egypt:

Mohamed El-Etreby, CEO of the National Bank of Egypt (NBE) confirmed in an official statement that the bank’s asset and liability committee has adjusted interest rates across its portfolio of deposit products. 

The three-year platinum certificate in Egyptian pounds with a fixed monthly return now offers 17 percent. 

The tiered-yield platinum certificates will offer monthly rates of 21 percent, 16.75 percent, and 13.5 percent, while the annual yield versions will offer 23 percent, 18.5 percent, and 14 percent respectively. 

For certificates in U.S. dollars, the three-year product will yield a monthly return of 4.75 percent, the five-year certificate will offer 4.85 percent, and a new seven-year certificate will pay 4.90 percent monthly.

Banque Misr 

Banque Misr also announced a downward adjustment in the interest rates for its savings products. The fixed-rate “Al-Qimma” certificate in Egyptian pounds will now provide an annual return of 17 percent over three years, reduced from 18.5 percent. 

The “Ibn Misr” certificate, which offers a decreasing fixed return over three years, will now yield 20.5 percent in the first year instead of 23 percent, 17 percent in the second year instead of 19.5 percent, and 13.5 percent in the third year instead of 16 percent. 

For dollar-denominated certificates, the three-year fixed-rate product will offer a monthly return of 4.75 percent instead of 5.15 percent. The quarterly, semi-annual, and annual return options have also been reduced to 4.77 percent, 4.80 percent, and 4.85 percent respectively. The five-year certificates will now yield 4.85 percent monthly, 4.87 percent quarterly, 4.90 percent semi-annually, and 4.95 percent annually.

These adjustments come at a pivotal time as Egypt navigates a complex economic landscape. The interest rate cuts by the Central Bank are part of a broader strategy to stimulate investment and reduce borrowing costs while continuing structural reforms. 

The changes follow last week’s move by the Monetary Policy Committee of the Central Bank, which reduced the overnight deposit and lending rates by 200 basis points, bringing them to 22 percent and 23 percent respectively. The main operation rate was also lowered to 22.5 percent.

The Central Bank stated that the decision reflects its assessment of the latest inflation data and projections, aiming to support economic growth and bring inflation back within its target range.