The Central Bank of Egypt (CBE) reported that the total financial position of banks operating in the local market rose to about EGP 13.798trn in June 2023, compared to about EGP 10.037trn in June 2022, an increase of about EGP 3.761trn.
According to its monthly report, the CBE stated that on the assets side, cash balances in banks in June 2023 reached EGP 106.241bn. Bank balances at some of them locally amounted to EGP 2.326trn, while their balances in banks abroad were EGP 308.623bn.
It also said that customer lending and debit balances amounted to EGP 4.798trn, while the securities portfolio and bank investments in treasury bills were EGP 4.855trn. The volume of other assets, which the CBE did not specify, was EGP 1.402trn.
On the liabilities side, the CBE indicated that the banks’ capital was EGP 323.776bn, reserves were EGP 492.386bn, and the balance of allocations was EGP 305.455bn.
Banks’ obligations towards each other locally were EGP 575.767bn, while their obligations towards banks abroad were EGP 450.686bn.
The balances of bonds and long-term loans were EGP 541.945bn, and the volume of other liabilities, which the CBE did not mention, was EGP 1.657trn.
Moreover, the CBE revealed an increase in customer deposits in banks operating in the Egyptian market to EGP 9.472trn in June 2023, compared to about EGP 7.369trn in June 2022, an increase of about EGP 2.103trn.
The CBE said that government deposits in banks were EGP 2.157trn in June 2023, while non-governmental deposits were EGP 7.315trn.
It added that government deposits in local currency were EGP 1.855trn, while deposits in foreign currencies were nearly EGP 301.6bn.
It also pointed out that non-governmental deposits in local currency were about EGP 5.750trn, while deposits in foreign currencies were EGP 1.564trn.
According to the CBE, the public business sector had about EGP 143.46bn of non-governmental deposits in local currency, the private business sector had EGP 985.16bn, the household sector had EGP 4.594trn, and non-residents had EGP 27.937bn.
This comes as the public business sector’s share of deposits in foreign currencies was nearly EGP 90.868bn, the private business sector’s share was about EGP 507.734bn, the household sector’s share was about EGP 917.6bn, and non-residents’ share was about EGP 48.120bn.
According to the CBE, the household sector accounted for 76.1% of the total deposits in banks operating in the Egyptian market until the end of June 2023.
It noted that this household sector accounted for about 80.3% of the total deposits in local currency, while its share of deposits in foreign currencies was about 60.5%.
The growth rate in total deposits in banks in June 2023 reached about 24%. The growth rate in deposits in local currency was 14.7%, while the growth rate of deposits in foreign currencies was 79.2%.
The share of deposits in foreign currencies was 20.94% of the total deposits in banks in June 2023.
CBE reported that the credit facilities granted by banks to their customers increased to about EGP 4.799trn in June 2023, an increase of EGP 1.234trn from June 2022.
Credit facilities are the loans that banks offer to their customers, as well as the documentary credits and letters of guarantee that they issue for them to cover import operations.
The CBE attributed this increase to the growth of credit facilities for non-government entities by EGP 514.6bn, or 23.3%, and for the government by EGP 719.6bn, or 53%.
According to the CBE, the growth of credit facilities for the government resulted from an increase in foreign currency balances of nearly EGP 509.9bn, and local currency balances of EGP 209.7bn.
The CBE also revealed the relative distribution of credit facility balances for non-government entities, showing that the private business sector received 63% of the total in June 2023. Moreover, according to the sectors of economic activity, the industrial sector received 29.3% of the total, followed by the services sector with 27.8%, then the trade sector with 9.8%, the agriculture sector with 2.1%, and other undistributed sectors with 31%, including 30.8% for the household sector.
On the other hand, the CBE disclosed that the public sector banks’ investments in treasury bills amounted to EGP 309.193bn in July 2023, compared to EGP 287.138bn in June. The private sector banks’ investments reached EGP 491.98nb, compared to EGP 458.313bn.
The investments of foreign bank branches recorded EGP 78.339bn, compared to EGP 847.87bn, while the investments of specialized banks amounted to EGP 132.532bn, compared to EGP 118.518bn.
In another aspect, the CBE announced an increase in the domestic liquidity in the banking sector by about EGP 1.633bn during fiscal year 2022/3023 to EGP 8.248bn in June 2023, with a growth rate of 24.7% compared to June 2022.
It explained that this increase was reflected in the growth of quasi-money by EGP 1.118trn, or 22.1%, and of money supply by about EGP 515.6bn, or 33.4%.
The CBE also pointed out that the growth of quasi-money resulted from an increase in foreign currency deposits, equivalent to EGP 670bn, or 79.2%, and in non-current local currency deposits, amounting to EGP 448.1bn, or 10.6%.
As for the growth of the money supply, it was caused by an increase in current local currency deposits by EGP 285bn, or 37.2%, and in cash circulated outside the banking system by about EGP 230.6bn, or 29.6%.
The CBE stated that the increase in domestic liquidity during the fiscal year 2022/2023 was due to the increase in net domestic assets and the decrease in net foreign assets of the banking system.
According to the CBE, the net domestic assets of the Egyptian banking sector increased by EGP 2.1trn, or at a rate of 30% during fiscal year 2022/2023, as a result of an increase in domestic credit by about EGP 1.982trn, or at a rate of 29.3%, and in net budget items by about EGP 114.3bn.
It explained that domestic credit increased as a result of an increase in net liabilities from the government by EGP 1.417trn, from the private business sector by EGP 412.6bn, from the household sector by about EGP 141.4bn, and from the public business sector by EGP 10. 3bn.
Moreover, the net foreign assets of the banking system decreased by EGP 462.6bn in the fiscal year 2022/2023, according to the Central Bank of Egypt (CBE). This was due to a decline in CBE’s net foreign assets by EGP 310.5bn and a decrease in the net foreign assets of the banks by EGP 152.1bn.
Meanwhile, the reserve money increased by EGP 335.8bn )28.2%), reaching EGP 1.528trn in June 2023. This was reflected in the increase in cash circulated outside CBE’s vaults by EGP 245.1bn, or 29.2%, and the increase in bank deposits in local currency at CBE by EGP 90.7bn, or 25.6%.
The CBE also explained that the increase in reserve money was the result of the increase in net liabilities from the government by EGP 338.8bn and net budget items by EGP 310.8bn, as well as the decrease in net liabilities from banks by EGP 161.7bn and net foreign assets at CBE by EGP 152.1bn.