File Photo: Central Bank of Egypt's headquarters is seen in downtown Cairo (Photo: Reuters)
The Central Bank of Egypt (CBE) has launched an initiative providing guarantee facilities worth EGP 7 billion for large corporations in the industrial, agricultural, and construction sectors.
The facilities will be issued in segments for Credit Guarantee Company (CGC) as an umbrella to cover the guarantee credits that the CGC issues for banks in order to cover a proportion of risks that relate to large corporate financing.
The action came in light of the procedures that the CBE is adopting to contain the impact of the COVID-19 crisis on the national economy, according to the CBE.
According to the initiative, the CGC is allowed to implement the initiative in line with the CBE’s supportive initiative for the industrial, agricultural and construction sectors.
Targeted categories involve the beneficiaries from the supportive initiative who have a total annual business revenue of EGP 200 million or more, according to the CBE.
The initiative is valid for 10 years, or until the depletion of the guarantee facility’s value.
On 13 December 2017, the CBE issued a decree providing a pledge worth EGP 2 billion for the CGC in exchange for which CGC would issue guarantee credits for small, medium and micro-sized projects to cover a portion of their related risks.
The CBE also launched an initiative on 12 December 2019 allocating EGP 100 billion for loans through banks with a decreasing interest rate of 8 percent to finance companies that operate in the industrial, agricultural and construction sectors that have total annual revenues of EGP 50 million or more.