A number of Egyptian banks are looking to tweak their capital structures to comply with Basel III regulations. Banque Misr, the National Bank of Egypt (NBE), and the Egyptian Arab Land Bank are among a number of institutions feeling pressured by new capital adequacy requirements, especially in light of the November 2016 EGP float. Banque Misr is looking to exit 50% of its investments over the coming three years, including its stake in Incolease and Banque du Misr Amman, while the NBE plans to auction off a significant amount of land in 1H2018, in addition to divesting other smaller, non-core investments. The Egyptian Arab Land Bank is also planning to offload EGP 3 bn-worth of land over the coming year and a half to allocate the additional liquidity to meeting Basel III requirements, as the central bank had advised in 2016.

The struggle is not as profound for international banks operating in Egypt or those with EGX listings, Pharos Holding’s Head of Research Radwa El Swaify tells Al Borsa, explaining that the CBE had instructed state-owned and smaller, mid-cap banks back in 2016 to gradually increase capital by 0.6% a year to reach a ratio of 12.5% by 2019.