However, both banks also hold significant FC liquidity cushions
(24% of FC deposits at Oschadbank and 23% at Ukreximbank at end-1Q18), mainly in the form of balances in foreign banks, which could also be used in part to service the Eurobonds.
She further said: 'The thing is, we have been able to build sufficient liquidity cushions
in the Treasury to temper these rate increases being demanded by the banks,' she said.
"Given the severe dollar shortage, we do not consider these banks' increased dollar funding to be enough to offset the erosion of foreign-currency liquidity cushions
. The banking system's liquidity ratio [cash due from banks and liquid investments as a percentage of foreign assets] in foreign currency declined to 48.9 per cent as of September 2015 from 57.4 per cent in June 2014, but we estimate that the ratio is materially lower at around 27.5 per cent if we exclude the banks' investments in foreign-currency Egyptian government bonds and treasury bills, which are usually renewed at their maturity," it further elaborated.
The Central Bank of Egypt (CBE), the Minister of Immigration and Egyptian Expatriates, and the leading government-owned banks, National Bank of Egypt and Banque du Caire, announced Mondaythe launch of US dollar certificates for sale to Egyptian expatriates."We estimate the increase is insufficient to alleviate the needs of business foreign currency and covers less than one month of imports, so banks' foreign currency liquidity cushions
will continue to decline," Moody's said.
In addition, the action reflects the lender's modest presence on the Kazakh market but also capital and liquidity cushions
and profitability that are in line with its rating level, the agency said.
: liquidity coverage ratio to for 30-day debt and net stable funding ratio for less liquid (12 month) assets
We are learning the lessons of the crisis in requiring better capitalization for our banks and larger liquidity cushions
, two essential elements for stronger stability in our financial system," EU Commissioner for Internal Market Michel Barnier said in a statement."The European Commission wishes keenly to see this agreement confirmed by the Heads of State and Government at the G20 meeting in Seoul in November," he said.Under the new banker's deal, common equity requirements will rise from 2 percent to 7 percent of assets, while total capital requirements will, for the first time, pass the bar of 10 percent of assets by 2019."This agreement will have a major impact for our continent, as Europe is home to half of the world's global banking assets," added Barnier.
"Financial soundness indicators constructed from individual bank balance sheets suggest that GCC banks remain well capitalised and profitable with system-wide capital and liquidity cushions
that helped them weather the global financial turmoil better in 2009," said George Abed, IIF Senior Counsellor and Director of the Middle East-Africa Department.
Both banks have loan/deposit ratios of under 100% and liquidity cushions
of nearly 40% of their respective balance sheets.
"Moody's recognises that BisB has demonstrated its capacity to weather the current financial stress, especially by maintaining ample asset liquidity cushions
," Moody's lead analyst Anouar Hassoune said.
The banks have also managed to accumulate large liquidity cushions
due to limited new lending opportunities.