Non-performing loans at banks operating in the Egyptian market fell to around 5.9% of the total loan portfolio by the end of June, compared to 6.7% in March 2016, according to the Central Bank of Egypt (CBE).
In a recent report prepared by the CBE, and published exclusively by Daily News Egypt, banks operating in Egypt have allocated loan provisions to non-performing loans at a rate of about 99% of the total non-performing loans in June, almost the same as in March.
The report indicated that the private sector accounted for 70.6% of the total loans granted by banks to their customers at the end of June, compared to 74.9% at the end of March.
According to the CBE, return on average assets of banks operating in the Egyptian market stabilised at around 1.5% during June, unchanged from March. Return on average equity stood at 24.4%, while net interest margin remained at 4%.
Liquidity ratio in local currency decreased to 55.2% in June, compared to 59.9% in March, while the average liquidity in foreign currency rose to 60.5% in June from 53% in March.
The CBE’s report pointed out that the loans to deposits ratio reached 44.5% in June, compared to 42.6% in March, and total loans ratio to deposits in local currency increased to 39.5% in June, compared to 36.9% in March. Loans to deposits ratio in foreign currencies slightly dropped to 64.1% in June compared to 64.4% in March.
The deposits to assets ratio in June amounted to 74.7%, unchanged from March. The securities to assets portfolio declined to 22% in June, compared to 23.1% in March.
With regard to capital adequacy, the CBE revealed that the capital base to risk weighted assets declined to 13.8% in June from 14% in March. Tier 1 capital to risk-weighted assets also fell to 12% in June compared to 12.2% in March.
Common equity to risk-weighted assets amounted to 11.7% in June, compared to 11.5% in March, while leverage ratio fell to 5.1% in June, compared to 5.2% in March.
The CBE said that the percentage became recommendatory starting from the end of September 2015 until 2017, and obligatory from 2018 with a lower margin stated by 3%.