Regulatory Alerts2014-12-11
Amending instructions for money market funds
In December 2014, the Governor of the Central Bank of Egypt announced changes to regulations regarding money market funds (MMFs). The changes included raising the maximum aggregate limit for MMF investments in both MMFs and bills linked to a total of 7.5% and reducing the minimum guaranteed fixed assets of the bank by half (from 2% of bank capital, whichever was lower). Secondly, it emphasized that only bank employees should be involved in these operations, and enforced KYC (Know Your Customer) procedures for non-bank brokers. Thirdly, it offered a grace period of six months to non-bank brokers to adjust their positions according to the new rules, if necessary. Lastly, it required banks that exceeded specified limits to stop issuing new securities until they complied with these conditions and requested the acceptance of these amendments from Hisham Ramez, Governor of the Central Bank of Egypt in 2014 after the departure of the previous governor on December 18, 2012, pursuant to Decree No. 95 for the year 1992 and its implementing regulations.