In response to the Central Bank of Egypt’s (CBE) recent decision to raise key interest rates by 6% during an extraordinary Monetary Policy Committee (MPC) meeting, the National Bank of Egypt (NBE) and Banque Misr have jointly announced the launch of new three-year savings certificates offering returns of up to 30%.
The NBE has introduced a three-year savings certificate with a declining interest rate structure, providing an annual rate of 30% for the first year, 25% for the second year, and 20% for the third year. Additionally, the bank has revised the interest rate for the triple-platinum certificate, with diminishing returns set at 26% for the first year, 22% for the second year, and 18% for the third year for new issuances, effective from Wednesday.
Furthermore, the NBE has adjusted the interest rate for the three-year platinum certificate with a fixed return to 21.5% annually for new issuances starting from Wednesday, with monthly interest payments. The bank has also set the interest rates for one-year platinum certificates at 27% annually, payable at the end of the period, and 23.5% annually, with monthly returns. Additionally, a new option for daily interest payment has been introduced, offering an annual return rate of 23%.
Similarly, Banque Misr has decided to reintroduce the “Ibn Misr” savings certificate for three years with a decreasing interest rate. It offers various options for return payment periods to cater to customer preferences. The approved options include annual, quarterly, and monthly interest payment periods. The annual returns for this certificate are set at 30% for the first year, 25% for the second year, and 20% for the third year. For quarterly payment periods, returns are 27% for the first year, 23% for the second year, and 19% for the third year. Lastly, for monthly payment periods, returns are 26% for the first year, 22.5% for the second year, and 19% for the third year, for new issuances starting from Wednesday.
Both banks offer certificates starting from a denomination of EGP 1,000 and multiples thereof, available to individuals, including minors, whether Egyptian or foreign. Customers can acquire certificates through various channels such as the Internet, mobile banking, BM Online, ATMs, or by visiting any branch of the two banks. Additionally, customers can use the certificates as collateral for loans or obtain credit cards.
Redemption of the certificates is possible after six months, starting from the working day following the date of purchase, subject to the regulated terms and conditions.
The recent increase in the CBE’s key interest rates has automatically led to higher interest rates on variable-return certificates and certain loan products tied to the CBE’s basic interest rates. The market is eagerly anticipating the impact of the CBE’s decision on government debt instrument yields.
On Thursday, the CBE will conduct an auction on behalf of the Ministry of Finance, offering two treasury bills worth EGP 60 billion. The first bill has a value of EGP 30 billion and a maturity period of 182 days, while the second bill holds the same value but has a maturity period of 364 days.
