The Central Bank of Egypt's (CBE) Financial Stability Report shows that the ratio of non-performing loans to total loans fell to 1.9% in fiscal year 2025 and in March 2026. The sector continued to maintain high provisioning levels to cover those loans, supporting its ability to absorb expected credit losses, while local-currency loans continued to account for the largest share of total loans, limiting the credit risk associated with exchange-rate fluctuations.

The report said the CBE continues to strengthen risk management and governance frameworks at banks and to monitor their performance continuously, ensuring they keep complying with regulatory requirements and international best practices and standards for financial soundness. This was reflected in improved financial soundness indicators for the banking sector during fiscal year 2025 and through March 2026, strengthening its ability to absorb shocks and continue playing its pivotal role in providing the financing the local economy needs, including the foreign currency required to finance foreign trade. This was supported by the continued confidence of individual and institutional depositors in the banking sector, which helped bolster financial stability and drive economic growth.

The report noted that the Egyptian banking sector is highly resilient and able to withstand various shocks amid elevated risks to global financial stability, particularly as geopolitical tensions escalate. This resilience is supported by the CBE's continued adoption of appropriate regulatory and prudential measures in line with economic and financial developments at home and abroad, and in step with the constantly changing nature and sources of risk, including emerging risks.