During the Cold War, Egypt’s centralized, state-directed economy served as a model for other countries looking to adopt a socialist system. All commercial banks were state-owned, and bank employees were part of the massive Egyptian bureaucracy. Yet since the early 1990s, Egypt has embarked on an ambitious reform that has progressively made it one of the region’s most attractive markets for growth in banking. Egypt’s heavy-handed state-directed economy was slowly liberalized beginning with a series of reforms in 1991 that brought the state fiscal deficit under control. In 1996, the government announced a program to begin privatizing public industries, including banks. The government’s reform plans were stalled from 2000 to 2003, when the Egyptian pound (LE) was severely devalued, leading to low economic growth and high inflation rates. Egypt began to take steps to correct the pound’s devaluation and limit inflation in 2003. The current government, headed by Prime Minister
