Central Bank of Egypt

Central Bank of Egypt
Bank name	Central Bank of Egypt
Image title 1	Headquarters in Cairo
Established	0 1961
Ownership	100% state ownership
Governor	Hassan Abdalla
Country	Egypt
Currency	Egyptian pound
Currency iso	EGP
Reserves	$35.1 billion (as of December 2023)
Headquarters	Cairo, Egypt
Website	https://www.cbe.org.eg

Central Bank of Egypt is the primary monetary authority and central bank of the Arab Republic of Egypt. Founded in 1961, it succeeded the National Bank of Egypt in issuing the national currency and regulating the banking sector. The institution is headquartered in Cairo and plays a pivotal role in formulating monetary policy, ensuring price stability, and supervising the Egyptian banking system.

History

The establishment of the bank was formalized under Law No. 250 of 1960, beginning operations in 1961 during the presidency of Gamal Abdel Nasser as part of broader socialist economic reforms. This move centralized monetary authority, which had been partially shared with the National Bank of Egypt since its founding in 1898. Key historical milestones include its management of the Egyptian pound's transition from a sterling-backed currency and its role during economic shifts like the Infitah policies under Anwar Sadat and subsequent International Monetary Fund agreements. The bank's headquarters were later moved to a distinctive tower in Cairo's Nasr City district.

Functions and objectives

Its primary legal mandate, defined by the Banking and Credit Law No. 88 of 2003 and the Constitution of Egypt, is to ensure price stability and maintain the stability of the Egyptian banking system. Core functions include issuing banknotes and coins, acting as the banker to the government, managing the state's foreign exchange reserves and gold reserves, and serving as the lender of last resort. The bank also oversees the national payment systems, including the Real Time Gross Settlement system, and represents Egypt in international financial institutions like the International Monetary Fund and the World Bank.

Organizational structure

The bank is governed by a board of directors chaired by the Governor and includes two Deputy Governors and several members appointed by the President of Egypt. Its operations are divided into specialized sectors, including the Monetary Policy Committee, the Banking Supervision Sector, and the Foreign Exchange Sector. Key internal bodies include the Risk Management Unit and the Legal Affairs Department. The bank maintains branches in major governorates like Alexandria and Suez and has representative offices at the Arab Monetary Fund in Abu Dhabi.

Monetary policy and instruments

The bank's Monetary Policy Committee sets the benchmark overnight deposit rate and overnight lending rate to influence inflation and liquidity. Primary policy instruments include open market operations, the discount rate, and the required reserve ratio for commercial banks such as Banque Misr and Commercial International Bank. Since 2005, it has formally targeted inflation, and in recent years has utilized foreign exchange auctions and treasury bill sales to manage the Egyptian pound exchange rate amidst pressures from foreign currency shortages.

Financial stability and supervision

As the primary regulator, it licenses and supervises all banks operating in Egypt, including public sector banks, private banks, and Islamic banks, under the Basel III framework. It conducts regular stress tests and on-site inspections, enforces anti-money laundering regulations in coordination with the Financial Regulatory Authority, and operates a deposit insurance fund. The bank also monitors systemic risk and intervenes to resolve troubled institutions, as seen historically with the Bank of Credit and Commerce International scandal.

Governors

The Governor is appointed by the President of Egypt. Notable governors include Ahmed Zaki Saad (1961–1967), Mahmoud Salah Eddine Hafez (1971–1976), and Farouk El Okdah (2003–2013). Hisham Ramez served from 2013 to 2015, followed by Tarek Amer (2015–2022), who oversaw a major devaluation in 2016. The current Governor, Hassan Abdalla, was appointed in 2022 and previously served as Vice Chairman of the Arab African International Bank.

Category:Central banks Category:Banks of Egypt Category:1961 establishments in Egypt Category:Economy of Egypt