Egypt's central bank increases reserve requirement on deposits to 14%

The Central Bank of Egypt (CBE) said on Tuesday it is increasing the reserve requirement on deposits from 10 percent to 14 percent as a result of the strengthening performance and profitability of local banks.

The new ratio is effective starting on 10 October, the bank said in a statement.

Between 2001 and 2011, the ratio stood at 14 percent. After the 2011 revolution, the ratio was gradually lowered to 10 percent in a bid to increase banking sector liquidity.

"In view of the strong financial indicators shown by the Egyptian banks and their strengthening performance and profitability, which has resulted in financial and monetary stability, it is now suitable to return the ratio back to its previous rates," the bank said.