Banks have been seeing waves of US dollars and the new certificates with up to 20% interest offered by banks being sold in the second week since liberating the exchange rate and floating the Egyptian pound.
Banks bought some $1.4bn from clients throughout the first week of floating the currency, while clients acquired EGP 70bn worth of the new pound-denominated saving certificates, governor of the Central Bank of Egypt (CBE) Tarek Amer said on Saturday.
All Banque du Caire branches across Egypt have been buying dollars from clients, and many customers sell their US dollars to buy the new saving certificates that the bank offers with interest rates of 16% and 20%, chairperson and CEO Mounir El-Zahid said.
“The bank has never seen this appetite to sell dollars before,” he said. The bank bought the equivalent amount of dollars in one day to the dollars usually acquired over one month before the flotation. He explained that liberating the exchange rate pushed clients to sell their dollars at banks, making them in charge of setting the exchange rate instead of the unofficial market.
“This reflects the confidence of citizens in the new mechanism adopted by the CBE,” he said. “It also indicates the thirst for the market to unify the exchange rate and deal through regular banking channels.” El-Zahid said banks are able to price currency according to supply and demand mechanisms instead of speculations that controlled the exchange market in the past period.
He added that allowing banks to deal in foreign currencies according to market mechanisms and determinants of supply and demand is a turning point for the banking industry in Egypt.
Moreover, he expected global investment funds to return to the Egyptian market, supported by the unified real exchange rate, as well as offering Egyptian treasury bonds on international markets that would see competitive return and high demand.
Banque du Caire has taken the initiative to open all branches until 9pm on weekdays and weekends to sell and buy dollars and provide remittances services.
The bank has extended its working hours in 61 branches across the republic until 4pm to provide all banking services so as to keep up with the demand for banking services and meet the needs and requirements of customers.
El-Zahid said that the bank is about to issue new rules and regulations for spending limits imposed on the cards it issues. The spending limit on credit cards is expected to be increased and commission fees to be lowered.