The Central Bank of Egypt is reportedly considering punitive measures for banks that do not get on board with its EGP 200 bn SME initiative, said CBE sub-governor Tarek El Kholy, Al Mal reports. The measures include refusing to approve raising non-compliant bank’s capital adequacy ratios and only allowing them to open new branches in underpopulated areas, he said at a conference yesterday. The SME program would require banks to ensure that SMEs account for 20% of their loan portfolio within four years. The National Bank of Egypt made sure to chime-in with a pledge to nearly triple its SME loan portfolio to EGP 70 bn in four years’ time.

Meanwhile, El Kholy welcomed Morocco’s Attijariwafa’s acquisition of Barclays Bank, a move he said would help inject new SME funding, something the bank is quite expert at.

Oh, and speaking of the transaction: Barclays Bank will apparently not pay capital gains tax on the sale of its Egyptian branch to Attijariwafa in Egypt. Al Borsa quotes an unnamed source as saying the bank will pay the tax in the UK, a country that has an agreement with Egypt that eliminates double taxation.