Banking Act receives committee-level approval at Egypt’s parliament
Most banks are ready for the Banking Act’s new capital requirements: Around 70% of banks operating in Egypt currently meet the increased capital requirements contained in the draft Banking Act, CBE Deputy Governor Gamal Negm said yesterday. Speaking on the sidelines of the Nile Pioneers Initiative, Negm told reporters that the remaining 30% will have a deadline to raise the extra capital, without providing specifics. This is likely to result in a spate of new mergers and acquisitions for smaller local banks that are unable to raise paid-up capital or boost their earnings. The draft law will raise capital requirements for all banks apart from SME lenders and digital banks. The requirements for local banks will rise tenfold to EGP 5 bn and threefold for foreign banks to USD 150 mn.
The House Economic Committee is almost done reviewing the draft legislation, and will soon hand it over to the general assembly for a vote, Al Shorouk reported Negm as saying. The bill, which has been in the works since 2017, would grant the CBE increased oversight over the banking sector, introduce measures governing e-payment, fintech businesses, and cryptocurrencies, and strengthen data protection and consumer privacy. You can find out more about the details of the legislation here and here.