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Thursday, 5 March 2020

CBE writes off EGP 17.4 bn in debt for financially distressed firms

CBE writes off EGP 17.4 bn in debt for financially distressed firms: More than 200 companies have had a portion of their debts written off by the Central Bank of Egypt (CBE), Deputy Governor Gamal Negm said, according to Masrawy. Speaking after the Nile Pioneers Initiative yesterday, Negm said the central bank had agreed to wipe EGP 17.4 bn in debt held by 226 companies, which owe a combined EGP 63.6 bn in bank loans.

Not all of this was settled under the CBE’s debt relief initiative: Under the initiative, the CBE made agreements with 155 companies to settle debts worth EGP 19.4 bn, forgiving EGP 10.9 bn of this. The remaining 71 companies secured agreements outside it, seeing EGP 6.5 bn wiped from their EGP 44.2 bn debt load.

FRA finishes collecting lists of defaulters: The Financial Regulatory Authority has finished collecting from financial leasing and factoring companies information on firms seeking debt relief under the CBE program, unnamed sources told Al Mal. The data — which only includes companies with debts less than EGP 10 mn — has been sent to the central bank, the sources said.

Background: The CBE had launched an initiative in December last year to help some 5.2k factories settle their debts through exempting them from accrued interest payments and halt legal action against struggling factories. It then relaxed the terms of the initiative to include more factories and the Financial Regulatory Authority had also set up a committee to assess how non-banking financial services companies can be brought into the initiative.

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