Central: The “credit risk guarantee” portfolio amounted to 2.3% of GDP in 2020

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The company’s activity contributed to the creation of 120,000 new job opportunities, pumping 600 million pounds into the state budget

Maintaining the continuity of 100,000 workers by implementing initiatives to support major companies and tourism

Naglaa Bahr: 100% increase in the volume of work of the guarantee company during the past year

The central bank said that the credit risk guarantee company’s portfolio amounted to about 2.3% of GDP for the year 2020.

He added in a statement that the company has contributed to supporting the state budget with more than 600 million pounds in insurance and taxes by providing 120,000 job opportunities, and by contributing through the major projects and tourism support programs to maintaining an existing employment of 100,000 workers.

The volume of the company’s guaranteed credit portfolio amounted to about 95 billion pounds, from which more than 69,000 clients benefited from small, medium and large enterprises, and 100,000 clients in the micro-sector, representing a market share of 42% of the total volume of bank credit for the small, medium and micro enterprises sector.

The Central Bank launched an initiative last year under which it issued a pledge of EGP 7 billion on segments in favor of the Credit Risk Guarantee Company, as an umbrella to guarantee the balances of guarantees issued by the company in favor of banks to cover a proportion of the risks associated with financing large companies, as part of its many measures taken to combat the impact of the Corona pandemic on the economy .

He also issued a guarantee of 3 billion pounds on tranches for the company to guarantee loans intended to finance the salaries of workers in the tourism sector.

Naglaa Bahr, managing director of the Credit Risk Guarantee Company, said that “In parallel with the Central Bank’s efforts to provide liquidity to the private sector to drive market movement, the company has modified its tools to keep pace with the Central Bank’s trends by increasing the coverage rate of targeted programs for the affected sectors, and also encouraging banks to extend the financing period and amend the payment period and encourage On granting grace periods as a kind of facilitation, and to reduce the company’s commission to issue the guarantee in light of the need to pay with the wheel of work and facilitate financing.

The company has also facilitated the issuance procedures and activation of the portfolio guarantee product, which is fast, economical, and low in cost, in addition to facilitating procedures for exchange claims and encouraging the conclusion of scheduling and friendly settlements to encourage banks to relieve defaulting clients, as well as developing a model and working mechanisms to ensure the availability of a flexible operational structure and an appropriate environment of systems Work mechanisms and workers, to ensure that the guarantee company is able to quickly respond to the various initiatives existing and expected from the Central Bank of Egypt to keep pace with the ever-changing market requirements during the pandemic period and beyond.

In anticipation of the continuation of the pandemic for another period and the increase in the number of affected entities and companies and the diversity of their financial needs, the Credit Risk Guarantee Company has worked to ensure the existence of multiple guarantee products that meet the different and increasing financial needs during this exceptional period, including providing financing through investment through a guarantee product for investment funds. Private Equity Fund ”or“ Investment Capital ”or providing financing through money market instruments, for example guaranteeing“ securitization of bonds ”or“ Factoring Guarantee Product ”.

The statement said that with the advent of 2021 and the continuation of the repercussions of the pandemic and the lack of clarity regarding the return to the normal situation, the Central Bank of Egypt confirmed its continuation in implementing policies for government support for liquidity provision initiatives necessary to maintain the continuity of these business and employment and support the guarantee company to encourage banks to continue facilitating financing .

The Central Bank is working with a credit risk guarantee company to develop a well-thought-out policy and plan with clear goals and a timetable for a gradual return to normal conditions after the end of the pandemic, in order to maintain the stability of the banking market and help companies adapt to the transition to the post-pandemic phase with the decline of current initiatives.

The Central Bank said that in 2017 it purchased a 20% share of the existing shares of the company, and the Deputy Governor of the Central Bank of Egypt took over the chairmanship of the company’s board of directors, and in 2018 the Central Bank adopted a relative weight of the company’s guarantee when calculating the bank for the capital adequacy standard in light of the Basel laws for banks. Reducing the credit cost burden provided by banks to the target groups.

He added that the company achieved distinguished results that reached 1000%, an increase in the portfolio from 2015 until 2020, and an 1100% increase in the number of beneficiaries for the same period.

The central article: The “Credit Risk Guarantee” portfolio amounted to 2.3% of GDP in 2020, was written in Al-Borsa newspaper.