The newly released 25% certificates of deposit have raked in almost EGP 100 bn in a matter of days — and the two state banks offering them have reportedly secured a major loan to meet local demand for hard currency.

Savers poured nearly EGP 100 bn into newly introduced record-high yield 25% certificates of deposit as of last Friday, National Bank of Egypt Deputy Chairman Yehia Aboul Fotouh said in a phone-in over the weekend with Kelma Akhira’s Lamees El Hadidi (watch, runtime: 11:55). Savers invested some EGP 66 bn in CDs at the National Bank of Egypt (NBE) and EGP 31 bn at Banque Misr, he added. The two state-owned banks are the only banks so far offering the CDs.

The Big Two are working overtime to capture appetite for the instruments: Bank clerks at some 126 branches of Banque Misr (pdf) and 146 branches of the NBE (pdf) worked to process requests for CDs on Friday and Sunday, which was a national holiday to mark Coptic Christmas, Aboul Fotouh said.

Nearly half of the money poured into the CDs is fresh money, not money taken out of other CDs, Aboul Fotouh said, adding that many depositors have de-dollarized to buy into the certificates

Aboul Fotouh doesn’t see the EGP falling much more against the greenback: High demand for the CDs is a good sign for the EGP moving forward, he says, saying the instruments will help curb demand for the greenback and allow the EGP to stabilize at its current rate. The current exchange rate — which stands at around USD 27 / EGP — is appropriate, Aboul Fotouh said, adding that he does not expect the EGP to fall much further.

REMEMBER- The CDs were introduced to convince folks with hard currency deposits in the banking system to de-dollarize — and, at the same time, to tamp down inflation by reducing liquidity in the market.

NBE, BANQUE MISR SAID TO SECURE MAJOR USD FACILITY

The National Bank of Egypt NBE and Banque Misr have reportedly secured loans worth a combined USD 705 mn from global lenders to meet the local demand for hard currency as the government looks to clear a backlog of imports at our ports, Al Arabyia reports, citing what it says are unnamed sources in the banking industry.

The details: Banque Misr reportedly secured a seven-year, USD 300 mn loan from the African Development Bank (AfDB). NBE secured a three-year, USD 405 mn loan from a consortium of Gulf lenders including our friends at Mashreq Bank as well as Doha Bank, Emirates NBD, and First Abu Dhabi Bank, as well as Standard Chartered and Japan’s Sumitomo Mitsui Banking Corporation, the sources told Al Arabiya.