CAIRO – 19 November 2024: Fitch Ratings has upgraded the creditworthiness of four major Egyptian banks. The National Bank of Egypt (NBE), Banque Misr (BM), Commercial International Bank (CIB), and Banque du Caire (BDC) have all seen their Long-Term Issuer Default Ratings (IDRs) raised to ‘B’/Stable from ‘B’/Positive.
The upgrades come in the wake of improved operating conditions in Egypt’s banking sector. Foreign currency liquidity has shown marked improvement compared to 2023, supported by strong capital inflows, including nearly $17 billion from non-resident investments in treasury bills, remittances, and proceeds from the Ras Al Hekma deal.
The sector’s net foreign assets deficit has narrowed significantly, dropping to $130 million by September 2024, down from $17.6 billion in January. In light of these developments, Fitch upgraded the operating environment score for Egyptian banks to ‘b’/Stable from ‘b-’/Positive, signalling optimism for continued macroeconomic stability.
As a result of these positive developments, Fitch has upgraded the operating environment score for Egyptian banks, signaling optimism for continued macroeconomic stability. The outlook for the Egyptian banking sector appears stable, with real GDP growth projected to accelerate from 2.4% in 2023 to 4.2% in 2025 and 5.4% in 2026. Inflation is forecast to decline significantly, dropping from 26.5% in October 2024 to 12.5% by mid-2025, further bolstering confidence in the operating environment.
Fitch’s upgrade also reflects the improved asset quality and risk profile of the banks, along with their strengthened funding and liquidity positions.
This positive assessment from Fitch underscores the improving financial stability in Egypt and the pivotal role of its banking sector in supporting economic recovery and development.
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