Hassan Abdalla, acting governor of the Central Bank of Egypt (CBE), took on his first duties last week with a message of reassurance to Egyptians, saying that the Egyptian banking sector is strong and capable of supporting the economy. During his first meeting with the leaders of banks operating in the Egyptian market last Wednesday, Abdalla said that even though this stage is critical, the Egyptian banking system is accustomed to overcoming challenges. Abdalla was also keen to emphasise that all Egyptian banking sector employees are one family, saying: "We are all one family. There will be disagreements, and this is normal, but in the end we stand together." Abdalla also made a surprising announcement that he appointed Hisham Ezz Al-Arab, former chairperson of the Commercial International Bank (CIB); and Mohamed Naguib, former chairperson of saib Bank, as his advisers. After the announcement, Ezz Al-Arab took to his official Facebook account to say: "May the lord be by our side as we perform our duties. I trust that we will succeed despite the challenges." Ezz Al-Arab was the chairperson and managing director of the CIB from 2001 until October 22, 2020. He has about 45 years of extensive experience in the banking sector. Prior to joining the CIB, he held several positions at Deutsche Bank, JP Morgan, and Merrill Lynch in several countries, including Egypt, the US, and Bahrain. Ezz Al-Arab was also President of the Federation of Egyptian Banks (FEB) between 2013 and 2016/2017 and 2020. Moreover, he held several other positions, including co-chair of the Advisory Board for Emerging Markets of the Institute of International Finance (IIF), member of the regional advisory board of MasterCard Middle East, non-executive member of the Fairfax Africa Board of Directors, in addition to being a non-executive member of Ripplewood Advisers MENA Holdings ltd. As for Naguib, he was the chairperson and managing director of the Arab International Bank (SAIB) from 2011 to 2018 and has 40 years of experience in banking, financial leasing, and credit. Naguib held the position of chairperson of the Board of Directors of Banque Misr in Germany, vice chairperson of the Board of Directors of Banque Misr, and a member of the Board of Directors of the International Company for Financial Leasing (incolease), the National Bank of Egypt (NBE), the Financial Holding Company for Civil Aviation (CIAF), the General Authority for Investment and Free Zones (GAFI), and the Micro, Small, and Medium Enterprises Development Agency (MSMEDA). CBE impose new banking regulations In his first decision as acting CBE governor, Abdalla removed the maximum limit for deposits for individuals and companies in bank branches and ATMs. He also decided to increase the daily maximum limit for cash withdrawals for individuals and companies in bank branches from EGP 50,000 to EGP 150,000 and keep the daily limit of EGP 20,000 for ATM withdrawals. The CBE stated that this decision is an amendment to a decision issued on 22 April 2020 regarding reducing the maximum limits for cash withdrawals and deposits for individuals and companies as part of the precautionary measures taken to address the repercussions of the coronavirus pandemic. Commenting on these new decisions made by the CBE, former vice president of Blom Bank Egypt Tarek Metwally said that appointing Ezz Al-Arab and Naguib as advisers to the governor is the right choice, especially that they are known for their efficiency and diverse expertise. Metwally explained that this difficult stage requires concerted efforts to develop the banking sector and overcome these challenges. With regard to the decision of deposit and withdrawal limits, Metwally said: "I think it is a natural procedure, and I expect more decisions to be issued by the CBE during the coming period to draw the road and pave the way for more policies." He explained that the origin of the cap decisions was the exceptional circumstances of the pandemic — they were supposed to be temporary. When more developments emerge, these decisions should naturally be reconsidered. Metwally also predicts that the CBE would also reconsider the initiatives that were previously put forward to support a number of economic sectors, including the initiative to support SMEs, whose cost is believed to be much greater than revenues for the sector. Furthermore, he expects the provision of foreign exchange for import operations to be reconsidered, along with the recent decisions made in this regard because of their impact on the business and employment community in light of the upcoming policies of the CBE and the importance of meeting international obligations. Finally, he called on everyone to give the new CBE's leadership a chance to do its work, saying "the mission is difficult, but not impossible."
