Cairo – Mubasher: The draft amendment of the Central Bank of Egypt’s (CBE) Law requires legal and constitutional research since it contradicts with the supervisory powers of other regulatory bodies, according to the committee studying the draft.
The amendments seek to extend the CBE’s supervision on firms and entities operating in the banking sector.
Mohammed Abdel Salam, the chairman of Misr for Central Clearing, Depository and Registry (MCDR), told Mubasher that the CBE is mandated to issue bonds to Egypt’s Ministry of Finance (MoF). Therefore, the CBE has the right to control and supervise the financial markets – a power that does not overstep other regulatory authorities.
On the other hand, the executive entities are mandated to implement the decisions taken, regardless of their nature, Abdel Salam added.
Economist at the Arab League Osama Abdel Khaliq indicated that the CBE has the required expertise and qualifications to take necessary decisions and implement them, in order to support the recovery of the Egyptian economy.
The CBE should expand its regulatory powers to prevent any irregularities in stock market trading, Abdel Khaliq added, explaining that speculations in the stock market are a normal phenomenon, but that this does not prevent some unneeded irregularities from occurring.
He stated that the draft amendment of the CBE’s Law has been needed for a while, adding that it is a positive step. He also affirmed that the draft amendment neither contradicts, nor is deemed incompatible with the authority of other regulatory bodies.
However, other analysts beg to differ on the matter, as a feature in Almal newspaper showed.
Ayman Sabry, a member of the board of the Egyptian Capital Market Association (ECMA), said that the draft amendment of Article 21 of the law opens the door for unjustified interventions by the CBE in monitoring the capital market, despite the existence of the Egyptian Financial Supervisory Authority (EFSA), which is responsible for regulating and supervising the market.
A senior official at the EFSA said that the draft amendments are "just preliminary proposals" and are still subject to discussion and deliberation between various entities.
