Egypt's central bank mandates 24% minimum interest on loans: Sources

“The CBE's directive, which went into effect yesterday, aims to protect bank deposits from being negatively affected by the new high-yield certificate of deposit (CDs) issued by the National Bank of Egypt (NBE) and Banque Misr,” added the sources, who preferred not to be named.

The sources explained that the interest rates offered on loans are determined by various factors, including the bank's cost of funds, expansion strategies, the need to attract new liquidity, competition dynamics, and the maintenance of their customer base.

On Thursday, NBE and Banque Misr announced the issuance of new CDs with annual yields of 23.5 percent and 27 percent, respectively.

The yields of the new CDs exceed the current borrowing interest rates in Egypt, which were maintained at 19.25 by the CBE's Monetary Policy Committee in its last meeting in December. 

Asset-liability committees (ALCO) in Egyptian banks, responsible for pricing savings and loan products in different banks, have been reportedly discussing the necessity of re-pricing their offerings based on prevailing market rates.