Egypt is negotiating a second package of financial assistance with the International Monetary Fund (IMF), after the Executive Board of the IMF approved approximately USD 2.8 billion in emergency funding for Egypt earlier this week, according to Rami Aboul Naga, the Deputy Governor of the Central Bank of Egypt (CBE). Aboul Naga stated that talks on the USD 6 billion funding program anticipated from the IMF have not yet concluded, whilst adding that the sum negotiated will depend on the final nature of the programs targeted from this funding. The Deput...

The Government of Bangladesh has drafted an Annual Development Programme (ADP) with a value over BDT 2.05 trillion for the 2020-21 fiscal period, amidst the on-going COVID-19 pandemic. According to the Secretary of the Planning Division, Muhammad Noor Ul Amin, the draft has been approved during a meeting held on the 12th of May 2020. Referring to the approved draft, Noor Ul Amin stated that the Government is intending to source 66% of the budget or BDT 1.34 trillion through domestic sources, with the remaining amount expected to be obtained from foreign ...

Moody's Investors Service (Moody's) has placed local and foreign currency long-term issuer and senior unsecured B3 ratings of Pakistan under scrutiny for downgrade. This is followed by the expectation that the Government of Pakistan would request for a bilateral official sector debt service relief under the recently launched G20 initiative. According to Moody’s, the suspension of debt service commitments to bilateral government creditors is unlikely to have rating implications and is expected to increase the Government’s fiscal resources to combat...

In a recent economic review by AllianceDBS Research (ADBS), a large volume of companies are anticipated to re-adjust their forecasts downwards following the release of the first quarter results, as corporates will be able to better assess the short-medium term impacts of the Movement Control Order (MCO), which has now been extended for the fourth time until the 9th of June 2020.  The research firm added that the economic impact of the COVID-19 pandemic has created a severe problem for governme...

S&P Global Ratings (S&P) has affirmed Saudi Arabia’s Banking Industry Country Risk Assessment (BICRA) at ‘4’ (on a 10-point scale, with 1 representing the lowest risk) during a recent review. S&P also affirmed the economic risk rating as well as the industry risk rating at ‘5’ and ‘3’, respectively. As part of S&P’s evaluation of industry risk, S&P has revised downward the assessment of the institutional framework from low risk to intermediate risk. S&P also added that it ...

Bangladesh Bank (BB) has announced that it will be introducing special repurchase agreement (repo) facilities for a period of twelve months to support Banks and Non-Bank Financial Institutions (NBFIs) to issue financing facilities under the stimulus packages declared by the Government of Bangladesh. This will be effective immediately and will continue until further notice, according to a circular issued by BB. Prior to this announcement, BB was providing funding to banks and NBFIs for regular repo for one to 28 days. In addition, BB had also recently reduced the...

Since the start of COVID-19, Bank Indonesia (BI) has been working closely with the Government of Indonesia and the Financial System Stability Committee on strengthening its policy mix to stabilize the IDR, maintain inflation, support the stability of financial systems, and to mitigate further declines in the economy. According to BI Governor Perry Warjiyo, the strategy to keep Indonesia’s financial system stable consists of six essential monetary policies. These include a reduction of BI’s seven-day reverse repo rate in two stages by 2...

The Lahore School of Economics (LSE) has estimated that the country may post a GDP contraction of 5.5% YoY, if the lockdown continues for a period of nine months, from March to November 2020. This estimation is significantly worse than other estimates made by key financial institutions, which forecast a 1.5% YoY contraction. The LSE determined by using a general equilibrium macro model, that under a best-case scenario, Pakistan may experience a 2.9% YoY contraction in overall GDP growth in 2020, following a three-mont...

Moody’s Investors Service (Moody’s) has affirmed the Government of Egypt’s long-term foreign and local currency issuer ratings at B2, with the Outlook remaining Stable. In addition, Moody’s also affirmed the country’s foreign currency senior unsecured ratings at B2, and foreign currency senior unsecured medium-term note rating at (P) B2. According to Moody’s, the affirmation of the B2 rating and stable outlook reflect Egypt’s strong credit profile, which will help it cope with COVID-19. Although the pandemic will ex...

According to Bashar Al-Natoor, Global Head of Islamic Finance at Fitch Ratings, government relief packages amidst the COVID-19 pandemic will help mitigate near-term effects for Islamic banks across many countries, however risk factors would vary from country to country.  In Indonesia, Islamic banks are likely to be as similarly affected as conventional banks, those with significant exposure to the tourism industry being likely to be more impacted. A prolonged outbreak would pose possible downside risks to the sector’s growth a...