The financial position of banks operating in the Egyptian market increased from EGP 207 billion to EGP 7.554 billion in March 2021, compared to EGP 7.347 billion in February 2021.
In a recent report, the Central Bank of Egypt (CBE) said the capital of banks in the local market stood at EGP 177.92 billion in March, up from EGP 174.7 billion in February.
At the same time, the volume of free reserves amounted to EGP 347.826 billion, and the balance of provisions for bad debts recorded EGP 165.588 billion.
The CBE said the volume of credit facilities extended by banks operating in the local market to their customers amounted to EGP 2.648 billion in March 2021. It also noted an increase in the volume of these facilities by 448, 2 billion EGP in nine months, with a growth rate of 20.4%.
Credit facilities are loans granted by banks to customers, as well as documentary credits and letters of guarantee that they open to cover import operations.
The CBE attributed the increase to the EGP 258.9 billion increase in the volume of credit facilities extended by banks to the state, at a rate of 38.4%. This was also driven by the EGP 189.3 billion increase in the volume of facilities granted to non-governmental parties, at a rate of 12.4%.
She explained that the increase in balances granted to non-governmental parties was the result of an increase in the volume of local currency facilities, amounting to EGP 252.3 billion. There was also an increase in foreign exchange facilities, equivalent to EGP 6.6 billion.
The CBE explained that the private business sector obtained about 59% of the total non-government credit facilities provided by banks to various economic sectors.
He pointed out that the industrial sector has received the most funding among the sectors financed by the banks. It got about 30.1% of the total of these facilities, followed by the service sector, which acquired 25.1%, then the trade sector for 10.8%.
The agricultural sector, as usual, obtained the lowest percentage of the volume of credit facilities granted by banks to different economic sectors. It only acquired 2% of the volume of these facilities in March 2021.
According to the EPC, there are other sectors which have not been mentioned in detail. They include the family sector, which obtained about 32% of the volume of these facilities.
The CBE announced an increase in the total outstanding loans granted by banks to their customers by EGP 73.109 billion to reach EGP 2.610 billion in March 2021, from EGP 2.537 billion in February 2021.
Government loan balances stood at EGP 910.026 billion in March 2021, up from EGP 861.566 billion in February 2021, an increase of EGP 48.460 billion.
Loans to government in local currency increased by EGP 49.320 billion, reaching EGP 636.914 billion in March 2021. From EGP 587.594 billion in February 2021.
Foreign currency loans to the government declined by around EGP 86 million to EGP 273.112 billion in March 2021, from EGP 273.972 billion in February 2021.
Total loans to non-government entities increased by EGP 24.649 billion to EGP 1.7 trillion in March 2021 from EGP 1.675 billion. Local currency balances stood at EGP 1.456 billion in March, up from EGP 1.428 billion in February, an increase of EGP 28.108 billion.
Loans to the agricultural sector amounted to EGP 32.158 billion in March, compared to EGP 31.215 billion in February. Lending to the industrial sector amounted to EGP 398.044 billion in March, compared to EGP 395.554 billion in February.
Loans to the trade sector reached EGP 169.871 billion in March, compared to EGP 164.731 billion in February.
Loans to unidentified sectors amounted to EGP 530.659 billion in March, compared to EGP 518.182 billion in February. Credit to the family sector reached EGP 529.386 billion in March, compared to EGP 516.939 billion in February.
Foreign currency loan balances recorded EGP 244.078 billion in March 2021, compared to EGP 247.537 billion in February.
Loans to the household sector in foreign currency amounted to EGP 8.305 billion in March, compared to EGP 8.431 billion in February.
On the other hand, the portfolio of securities and bank investments in treasury bills (T-bills) recorded approximately 2.838 billion EGP in March, compared to 2.736 billion EGP in February 2021.
The CBE revealed that deposits in banks registered around EGP 5.515 billion in March. This reflects an increase of EGP 141.45 billion, up from EGP 5.374 billion in February 2021.
He explained that government deposits registered EGP 980.7 billion in March, up from EGP 945.8 billion in February 2021.
Deposits were broken down into EGP 851.5 billion in local currency in March and EGP 129.1 billion in foreign currency.
Non-government deposits recorded around EGP 4.535 billion in March 2021, up from EGP 4.428 billion in February 2021.
Non-government local currency deposits recorded about EGP 3.875 billion, of which EGP 66.972 billion was in the public enterprise sector. An additional EGP 493.6 billion was recorded in the private business sector, EGP 3.299 billion for the household sector and EGP 15.4 billion for non-residents.
Deposits abroad amounted to EGP 659.7 billion in March 2021, of which: EGP 31.236 billion for the public business sector; 169.04 billion EGP for the private enterprise sector; 444.8 billion EGP for the household sector; and EGP 14.661 billion for non-residents.
Foreign and domestic assets
The CBE said net foreign assets increased by 155.3 billion EGP during the period from July 2020 to March 2021, to reach around 277.391 billion EGP.
He explained that this increase is the result of an increase in net foreign assets in banks, equivalent to EGP 391 billion, and net foreign assets in the CBE, equivalent to EGP 62.2 billion.
He pointed out that the local assets of the banking system increased over the same period by EGP 437.8 billion, or 9.9%. This was driven by the increase in domestic credit of EGP 336.4 billion, at a rate of 6.9%. The negative balance of net budget items decreased by EGP 101.4 billion, at a rate of 23.6%.
The CBE explained that domestic credit increased due to an increase in net liabilities of the private sector of EGP 111.5 billion, of the household sector of EGP 97.2 billion, of the public sector of EGP 129, EGP 3 billion and public sector enterprises EGP 1.6 billion. .