Banks offer a variety of savings products for customers seeking a regular return on their savings, and 3-year certificates are among the most prominent options, especially as interest rates and payout frequency vary from bank to bank. In this report, we review the key details of the semi-annual-payout 3-year certificate at QNB Egypt and Crédit Agricole Egypt, including the main terms, benefits and expected return.

Features of the fixed-rate 3-year certificate with semi-annual payout from QNB Egypt

  • Tenor: 3 years.

  • Interest rate: 17.6%

  • Payout frequency: semi-annual

  • Rate type: fixed

  • Minimum: EGP 1,000, in multiples thereof.

  • Interest accrues from the business day following the certificate's issue date.

  • Early redemption is available after 6 months from the issue date, subject to the announced redemption terms.

  • Credit facilities can be obtained against the certificate.

  • Interest can be credited to a current account or a savings account.

  • The certificate can be tracked and managed through e-banking services

Features of the fixed-rate 3-year certificate with semi-annual payout from Crédit Agricole Egypt

  • Tenor: 3 years.

  • Interest rate: 15%

  • Payout frequency: semi-annual

  • Rate type: fixed

  • Minimum: EGP 1,000

  • Currency: Egyptian pound.

  • Target segment: individuals.

  • Option to borrow or obtain a credit card against the certificate's value.

  • The certificate can be used as collateral for a loan or credit card at preferential rates.

  • Accounts and certificates can be tracked and managed 24 hours a day through internet banking, phone banking and ATMs.

Banky's view

The comparison shows that the semi-annual-payout 3-year certificate from QNB Egypt offers an annual interest rate of 17.6%, versus 15% a year for Crédit Agricole Egypt's semi-annual-payout 3-year certificate.

On a deposit of EGP 500,000, the approximate annual return at the announced rate is about EGP 88,000 at QNB Egypt, versus EGP 75,000 at Crédit Agricole, a difference of about EGP 13,000 a year.

That means each 6-month payout is about EGP 44,000 at QNB Egypt, versus EGP 37,500 at Crédit Agricole Egypt, a difference of about EGP 6,500 every 6 months.

Over 3 years, the total return on EGP 500,000, using a simple calculation that does not account for reinvesting the interest, comes to about EGP 264,000 at QNB Egypt, versus EGP 225,000 at Crédit Agricole, a total difference of about EGP 39,000.