Moody’s maintains positive outlook on Egyptian banks

Global rating agency Moody’s has maintained its positive outlook on the Egyptian banking system, driven by an improving economy, it said in a report on Monday.

Banks will continue to have good access to stable, deposit-based funding and hold large volumes of liquid assets, especially in local currency, it added.

According to the report, the real GDP growth in Egypt is forecast to reach 5.5 percent in 2019 and 5.8 percent in 2020, and banking penetration will deepen, supporting deposit and loan growth.

“Accelerating growth in Egypt reflects increased public and private-sector investment, higher exports and a recovery in tourism,” said Constantinos Kypreos, senior vice president at Moody’s Investors Service.

“We expect balance sheet growth of around 15 percent in 2019 and for banks to maintain ample local currency funding, high liquidity, and strong and stable profitability," he noted.