CBE Issues New Regulations for Amendments on the Industry and agricultural Private Sector companies Initiative

The Central Bank of Egypt issued a new Circular regarding the amendments on the Industry and agricultural Private Sector companies Initiative as per approval of PM, which revealed the approval of the PM to amend some of the parameters of the initiative referred to above, effective April 4, 2024, as follows:

 The rate of return incurred by the customer shall be 15% decreasing instead of 11% decreasing and the applicable rate of return shall be revised within three months at the latest or when the credit and discount rate is adjusted.

 Increasing the maximum amount of a single customer's loan to EGP 100 mn instead of EGP 75 mn, and a single customer and related parties to EGP 150 mn instead of EGP 112.5 mn, with the aim of making bigger amounts of money available to a single customer and related parties to make the best use of the initiative.

The statement indicated that these amendments will be applied to any new loans and any new withdrawals to finance working capital, i.e. that a decreasing 11% return will continue to be applied to the portion used and what will be used in the pre-contracted limits with regard to existing loans for financing machinery and equipment as well as the balance used to finance working capital on the date of this decision and until the date of its maturity.

This takes into account the existing of actual contracts for medium-term loans and amounts used under credit facilities to finance working capital.