CBE exempts four banks from applying Basil 2 Standards

The Central Bank of Egypt (CBE) announced that four banks working in the country would be exempt from having to adopt the Basil 2 Standards that were otherwise supposed to have been enacted by all banks by the end of the current fiscal year, stated a CBE official.

The exempt banks are Banque Misr, the Principal Bank for Development and Agricultural Credit, the Industrial Development and Worker’s Bank, and the Egyptian Arab Land Bank.

Two of these banks, the Egyptian Arab Land Bank and the Principal Bank for Development and Agricultural Credit, have suffered rising debt insolvency and appropriation voids, with the latter is also experiencing financial and structural problems with regards to its liquidity rates, monetary solvency issues, disclosure and governance practices in addition to old technological infrastructure.

Most banks were ready to adopt the Basil 2 Standards and apply them to their financial and technological infrastructure, in addition to clarifying their statistical reports. This was especially true for foreign banks working in Egypt that receive aid from the central banks of their home countries. Applying the Basil 2 Standards to the Egyptian banking sector has long been considered a pivotal step of the Banking Reform Programme, undertook by the CBE in 2009. It plans to create a regulatory framework that has the ability to assess risk and guarantee the stability of the Egyptian Banking sector while operating with greater efficiency in addressing these risks and staying up to date with international banking standards. This is an attempt to strengthen competition amongst Egypt’s banks.