04:05 PM
Tuesday 03 January 2023
I wrote – Manal Al-Masry:
The maturity dates for savings certificates with a high return of 18% in customer accounts at Al-Ahly and Egypt Banks start from next March 22 until the last maturity of May 31, in which work on the certificate was suspended, which may necessitate re-introducing it again to enhance customer savings, according to bankers who spoke. Masrawy to them.
The issuance of the National Bank of Egypt and the two largest government banks – a high-yield certificate with an interest of 18% for one year, with a monthly exchange period, on March 21, which coincided with the first major move in the exchange rate of the pound against foreign currencies (in a movement similar to a float).
The Central Bank usually resorts to seeking help from the National Bank of Egypt and the National Bank of Egypt in issuing high certificates to customers, as they are the two arms of the Central Bank in implementing its monetary policy to absorb inflationary pressures (price increases).
However, the two banks suddenly stopped selling the certificate on May 30, after collecting the targeted savings proceeds of 750 billion pounds within 71 days of its issuance.
Muhammad Badra, a banking expert, believes that it is necessary to re-offer the 18% certificate at least once again in the event that it is difficult to offer another 20% certificate in order to enhance the certificate holders’ reinvestment of their savings in the two banks, as well as the existence of a positive real return that compensates them for the high inflation.
The real return on customers’ savings – despite the high interest – was a negative number compared to the core inflation rate, which recorded 21.5% last November, when measured with the highest return a customer receives at 17.25% on the triple certificate.
Badra called for issuing certificates with a real return that exceeds inflation, explaining that this enhances the continuity of customers’ savings in banks, as well as protecting them from attempts to fall into fraud cases by some of the so-called (relatives).
The term “restless” has recently reappeared in Egyptian society after repeated incidents related to the looting of some simple people’s money by a number of fraudsters, especially in the regions, under the temptations of obtaining a high return that exceeds what is applied in official investment channels.
Hisham Okasha, President of the National Bank of Egypt, said in televised statements earlier that the bank’s tendency to issue certificates with a high interest rate of 20% is false news.
On the other hand, Mohamed El-Etreby, Chairman of Banque Misr, said that the bank will study the position of raising the interest on its certificates, after raising the interest rate at the Central Bank recently by 3%, according to the cost of funds at the bank.
The triple certificate of fixed return is 17.25%, disbursed annually, with the highest return currently presented in the National Bank of Egypt and Egypt and a number of other banks, but it did not receive the same demand from clients that its predecessors received due to their money being retained in the 18% certificate, as well as waiting for some of them to obtain a higher interest certificate. .
A member of the board of directors of a private bank told Masrawy that the introduction of a new, high-yield certificate by the National Bank of Egypt, with certificate dues of 18%, is required to compensate customers for the increase in the inflation rate.
He added that certificates with high interest represent a huge burden on the two banks with regard to their employment through loans, debt instruments, etc., but re-introducing them again may be an expected measure to provide a psychological feeling to customers.