- Population - 72.64m (2006)
- Total Labour force - 21.8m (2005)
- Lending interest rate in % - 13.1% (2005)
- % change in consumer prices (av) - 4.9% (2005)
- GDP at constant 1996/1997 prices - E£ 427.1 bn (2005)
- Agriculture, irrigation & fishing sectors as % of total GDP - 14% (2005)
Although in June 2004 there were 61 banks operating in Egypt, this number is falling, as the government of the prime minister, Ahmed Nazif, has expressed its intention to consolidate the sector to as few as 22 by the end of 2007. About 78% of total industry assets were held by the 28 commercial banks, including four major state-owned commercial banks (the NBE, the Bank of Alexandria, Banque du Caire and Banque Misr), which dominate the sector, accounting for nearly 57% of total assets, and holding 70% of deposits. There were also 30 investment and business banks; and three specialised banks—one industrial bank, one real estate bank and one agricultural bank.
The restructuring of the banking system is based on the strict enforcement of raised minimum capital requirements: local banks must increase their capital to E£500m (US$87m) from E£100m, and foreign banks to US$50m from US$15m. Banks had one year to comply, and the stipulation succeeded in prompting frenetic mergers and acquisition activity in the banking sector, both in the public sector and among the weaker private banks. In September 2005 the government announced the merger of the second- and third-largest banks, Banque Misr and Banque du Caire, to make Egypt’s largest bank in terms of assets. The government also breathed new life into privatisation in the sector by pressing ahead with the sales of the government’s existing stakes in joint ventures formed with foreign banks and, most boldly, committing itself to the sale of Bank of Alexandria, the smallest of the four key state-owned banks.
Banking practices remain broadly conservative and the services offered are often basic. State banks suffer from low capitalisation, overstaffing and stifling bureaucracy, as well as a high percentage of poorly performing loans made both to public enterprises and to well-connected individuals. The slowdown in the economy in 1999-2000, following a rapid growth of credit extension, increased banks’ portfolios of non-performing loans, which still stood at a quarter of the total as late as September 2004. To restore damaged confidence, new management teams with international and private-sector experience were appointed to the state-owned banks from 2002. Laws criminalising money laundering for the first time were passed in 2002-03, resulting in Egypt’s removal in 2004 from the “blacklist” of non-co-operative countries compiled by the Paris-based Financial Action Task Force on Money Laundering.
Source: The Economist Intelligence Unit