The Central Bank of Egypt (CBE) has announced a surge in net profits, reaching LE 107.693 billion by the end of October 2024. This marks a substantial increase from the LE 96.056 billion recorded just a month prior in September. The bank’s latest financial statement highlights strategic gains across several key financial metrics, underscoring its robust financial management.
The CBE’s report reveals that its reserves have climbed to LE 403.147 billion, with a capital standing at LE 21.600 billion. This financial health is further supported by a rise in total equity, which reached LE 162.413 billion, up from LE 150.667 billion in September. Simultaneously, the bank’s total liabilities have expanded to LE 6.050 trillion, reflecting a growing financial framework.
The asset portfolio of the CBE has also seen growth, increasing from LE 6.090 trillion at the end of September to LE 6.213 trillion by October’s close. Additionally, the bank has made substantial contributions to the capital of international financial institutions amounting to LE 26.210 billion and invested LE 79.099 billion in the capital of subsidiary and sister companies.
A notable aspect of CBE’s financial strategy includes an increase in its gold holdings, which advanced to LE 545.310 billion in October from LE 517.147 billion in the preceding month. This move is part of the bank’s efforts to fortify its financial position amidst global economic uncertainties.
Despite these positive developments, the CBE’s Monetary Policy Committee (MPC) has opted to maintain key interest rates for the fifth consecutive month. The overnight deposit rate remains at 28.25 percent, while the overnight lending and primary operations rates are steady at 27.75 percent. This decision reflects a cautious approach in managing inflationary pressures while ensuring economic stability.
Since initiating its monetary tightening cycle in March 2022, the CBE has raised interest rates by a cumulative 19 percent (1,900 basis points), including a significant 8 percent (800 basis points) hike in 2024. Looking forward, Fitch Ratings anticipates that the CBE will begin to ease monetary policy in 2025, predicting a 1,200 basis point reduction in interest rates, bringing them down to 16.25 percent by the year’s end. This expected shift signals a strategic move to balance inflation management with economic growth objectives.
Dr. Youssef Ahmed, a financial analyst with the Egyptian Economic Forum, commented, “The CBE’s financial performance illustrates a comprehensive strategy to bolster its reserves and assets while carefully navigating interest rate policies amidst global economic volatility.”
The CBE’s next Monetary Policy Committee meeting is slated for December 26, where further adjustments to the nation’s monetary policy might be discussed in light of evolving economic conditions. As Egypt continues to strengthen its economic frameworks, the CBE’s strategic financial maneuvers position the country to tackle both current and future economic challenges effectively.
