Egypt's central bank directs banks to increase financing for companies, factories

CAIRO – 18 November 2021: The Central Bank of Egypt (CBE) directed banks operating in the Egyptian market to increase financing for the operations of companies and factories, especially small and medium ones, which exceeds a total of 126,000 companies and factories.

Increasing financing will take place through injecting additional funds to help the companies and factories face the increase in international prices, and to maintain operating and production rates.

This came during a meeting chaired by Governor of the Central Bank, Tarek Amer, with the participation of the leaders of finance, risk and legal departments in banks, to complement the meetings that the Central Bank has started with companies since January 2020 to solve their financial problems, according to a statement issued, Thursday.

It also came in light of President Abdel Fatah El-Sisi’s directives to the governor to contribute to solving industry problems, increasing employment and production rates, and supporting the economy in the face of global market developments.

Amer stressed the need for banks and the banking supervision sector at the Central Bank to immediately end judicial disputes with thousands of companies and about 29,000 loans to individuals, while reviewing the rules for classifying troubled customers so that they are not deprived of bank financing.

He stressed that the impact of the Corona crisis is still extended, and thus suspending the classification of customers during the crisis so that their financial positions are not disturbed, while reconsidering the rules of marginalizing customers to encourage banks to finance them in case of default so as not to worsen their financial conditions.

The Governor of the Central Bank renewed his directives during the meeting to the banks to work on solving the financial problems of the industry and work to increase production rates, in light of the directives of President Abdel Fatah Al-Sisi to mitigate the external price shock on the Egyptian market, and to support all economic activities.

He also directed the heads of sectors in the banks to use their powers and take decisions that take into account the general interest of the economy and not only the interest of the bank, stressing that the safety of the economy is part of the safety of productive institutions.

Amer called for the need to work on solving the problems of the industry and to write off heavy fines from taxes, gas fines, land and insurances, in order to help companies get out of their financial stumble in order to preserve employment and return production rates to higher rates.