The move was aimed at reducing the central bank’s substantial losses incurred from covering the difference between subsidized and market interest rates on behalf of the Finance Ministry.
The Central Bank of Egypt (CBE) has announced a significant turnaround in its financial performance during the previous fiscal year (FY2023/2024), reporting its first profit since FY2016/2017.
According to its latest financial report, the bank achieved a net income of EGP 22.83 billion, marking a remarkable recovery from the EGP 86.3 billion loss recorded in the previous fiscal year.
The financial recovery can be partly attributed to a decree issued by Prime Minister Mostafa Madbouly in November 2022, which mandated the CBE to cease funding subsidized loans and transfer this responsibility to the finance, housing, and tourism ministries.
The move was aimed at reducing the central bank’s substantial losses incurred from covering the difference between subsidized and market interest rates on behalf of the finance ministry.
Ending these subsidies is also a condition for Egypt's $8 billion loan agreement with the International Monetary Fund (IMF), with the country completing its 3rd review back in July.
In addition to improved profitability, the CBE recently reported substantial growth in its total assets, which increased by 35% to EGP 6.1 trillion from EGP 4.5 trillion in the previous year.
The bank's gold reserves also grew by 91% to EGP 454.92 billion by the end of June 2024, up from EGP 238.6 billion a year earlier.
Last week, the central bank shared that Egypt's external debt fell by $7.4 billion in the first three months of 2024, with the country’s total external debt decreasing to $160.6 billion at the end of March from $168 billion at the end of December.
