Hassan Abdalla’s main challenge will be to contain soaring inflation and balance exchange rates.
At the end of August, banker Hassan Abdalla stepped in to replace Tarek Amer as interim governor of the Central Bank of Egypt. Abdalla’s main challenge will be containing soaring inflation and balancing exchange rates as Egypt grapples with the fallout from the war in Ukraine. In May 2022, the CBE raised the overnight interest rate by 200 basis points, bringing the deposit rate to 11.25% and the lending rate to 12.25%, among the highest in the world . The CBE had already raised its key rates by 100 basis points in March and allowed the Egyptian pound to depreciate by 16%.
President Sisi stressed “the need to develop monetary policies in line with global economic variables and to work to provide diverse sources of foreign currency” in a statement after the appointment. Still, industry experts expect the new CBE leader to maintain a monetary policy and overall strategy similar to that of his predecessor. Prior to his appointment, Abdalla was chairman of United Media Services Group, a public conglomerate that runs popular Egyptian television channels and newspapers.
Born in 1960, he has spent most of his career in the banking sector. In 1982, he joined the Arab African International Bank (AAIB) – a joint venture between the central bank of Egypt and the Kuwait Investment Authority – where he held various positions until he became CEO in 2002 to 2018.
Abdalla was among the first bankers to look into mergers and acquisitions as a means of boosting the Egyptian banking sector beginning in 2005 when the AAIB acquired Misr America International Bank, followed by the acquisition of the Egyptian operations of Canadian Bank Nova Scotia in 2015. He also teaches finance. at the American University in Cairo and founded Panther Associates, a financial advisory firm.
Hisham Ezz al-Arab, former chairman of the Commercial International Bank, called Abdalla to Reuters as “rational” and someone who “understands the international market”. Abdallah sits on the board of several cross-border financial institutions and has a reputation for maintaining good relations with his foreign counterparts. These soft skills could come in handy as Egypt negotiates a new bailout package with the IMF.