Egypt's banks forced to achieve world standards in operation and service

Governor of the Central Bank of Egypt (CBE) Mahmoud Abul Oyoun announced yesterday that the government is studying new measures to encourage banks merger to keep pace with the world changes in this regard. He added that the minimum capital rate will be raised from eight percent to 10 percent as of December 31, 2002.

The governor said that it is intended to increase the rate gradually to reach international rates of 12-14 per cent by 2004. He added that any banks unable to raise their capital would have to merge with larger banks.

Abul Oyoun told a seminar organized by the Egyptian Center for Economic Studies that merger incentives could be offered, such as tax exemptions on trade profits and gains within certain time limits.

He also emphasized the importance of promoting banking culture and the awareness of shareholders