Governmental, commercial, and specialised banks have started receiving requests from defaulting clients who would like to settle their debts, in accordance with an initiative launched by the Central Bank of Egypt (CBE) on Wednesday to settle the debts of over 3,500 companies and 337,000 individuals.
The list includes the National Bank of Egypt (NBE), Banque du Caire, Export Development Bank of Egypt (EDBE), Egyptian Arab Land Bank (EAL), Agricultural Bank of Egypt (ABE), United Bank, and Industrial Development, and Workers Bank of Egypt.
According to Tarek Fayed, the chairperson and CEO of Banque du Caire, his bank has started implementing the CBE’s initiative, pointing out that about 21,000 clients benefit from this initiative, including 18,000 individuals, while the rest are companies.
According to the CBE’s initiative, settling the debts will be for defaulters whose debts are less than EGP 10m, in addition to individuals with debts that do not include credit card debts, until December 2017, including individuals who have had legal actions taken against them and those who have not had legal actions taken against them.
According to El-Sayed El-Kosayer, the chairperson of ABE, his bank is currently preparing notifications for clients who meet the requirements of the initiative, in order to activate it instantly, noting that the process of inventorying these clients is still ongoing.
The CBE invited its clients to address banks to benefit from the initiative and end the largest number possible of defaulting cases that are pending in courts, allowing companies to go back to the cycle of economic activity.
According to Yehia Aboul Fotouh, the vice chairperson of NBE, his bank has opened its doors for clients who would like to settle their debts, urging them to go to the branch they deal with to request settlement.
Aboul Fotouh explained that the bank is currently inventorying its clients, whether companies or individuals, who meet these requirements, expecting the process to be completed within a few days.
Based on the initiative, banks will exempt defaulting clients from all accumulated unpaid interest, amounting to EGP 16.8bn, in the case of them committing to paying 100% of the outstanding debt until the end of December 2017, with a deadline that is due in December 2018.
In return, the lawsuits pending in courts will be waived, and the borrower will have a discharge of debts in accordance with the law. Additionally, all the guarantees presented from clients will be released as a guarantee of this debt. Moreover, the client would be removed from the negative lists of the CBE and the I-score list. The ban on these borrowers will also be removed. The client would also be approved as a client of the initiative for three years starting from the payment date.
The total unpaid accumulated debts owed by the target clients in this initiative amount to EGP 16.8bn, including EGP 12bn for troubled companies with debts worth less than EGP 10m, and EGP 4.8bn for individuals.