Regulatory Alerts2022-10-27
Added · Updated
Circular dated October 27, 2022 regarding financial derivatives linked to exchange rates
The Central Bank of Egypt amends the June 9, 2009 circular to permit banks to conduct FX forwards and swaps for corporate clients solely for hedging commercial transactions processed through the bank, explicitly prohibiting speculative use. The March 1, 2007 circular is amended to lift the ban on Non-Deliverable Forwards (NDFs) for corporate clients, allowing them only for hedging purposes and requiring settlement exclusively in local currency. Banks are also permitted to conduct these derivatives transactions with local banks for non-speculative purposes, subject to strict credit guidelines ensuring foreign currency repayment sources.
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