Egypt’s bank privatisation programme advanced with Banque du Caire’s record share offering, even as renewed inflation risks prompted the central bank to raise rates.

Elsewhere, UAE bank earnings showed lending growth supporting profits, while Bahrain’s proposed AI-native wholesale bank pointed to a new approach to serving cross-border institutional clients.

Read more on the week’s key developments:

1. Banque Misr sells 45% of Banque du Caire in EGP 36.37 billion IPO

Banque du Caire began trading on the Egyptian Exchange following the sale of 6.8625 billion existing shares at EGP 5.30 (approximately $0.10) each, representing 45% of its issued share capital. The EGP 36.37 billion ($658 million) offering was the largest IPO in Egyptian Exchange history in Egyptian-pound terms and implied a valuation of approximately EGP 80.83 billion ($1.46 billion). The public tranche was oversubscribed 27 times, while the transaction attracted international institutional interest, including $100 million investments from both the International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD).

As a secondary sale by Banque Misr, the offering broadens Banque du Caire’s ownership without adding fresh capital to the bank. IFC and EBRD’s participation brings institutional backing to its expansion plans, with IFC reporting that the bank aims to increase its financed customer base from approximately 899,000 to 1.9 million by 2030. Shares closed their first trading session at EGP 5.31, marginally above the offer price, despite strong subscription demand.

2. Egypt raises benchmark interest rates by 100 basis points amid inflation risks

The Central Bank of Egypt raised its overnight deposit and lending rates by 100 basis points to 20% and 21%, respectively, on 29 October, while the main operation and discount rates increased to 20.5%. Monthly headline and core inflation accelerated in September to 1.3% and 0.8%, respectively. The central bank said a more restrictive stance was needed to anchor inflation expectations and preserve progress towards its inflation target of 7%, plus or minus two percentage points, in the fourth quarter of 2027.

Variable-rate loans and other interest-earning assets may reprice upwards, but competition for deposits could raise funding costs, limiting the benefit to net interest margins. Higher borrowing costs may also moderate new credit demand and increase repayment pressure on existing borrowers.

3. UAE central bank fines foreign bank branch AED 200 million and orders executive reassessments

The Central Bank of the UAE imposed an AED 200 million ($54.5 million) penalty on an unnamed foreign bank branch following examinations that identified repeated deficiencies in anti-money laundering and counter-terrorism financing controls, governance, compliance management and sanctions procedures. The regulator also imposed individual penalties of AED 500,000 ($136,000) on the branch’s chief executive officer and AED 300,000 ($82,000) on its head of compliance and money laundering reporting officer. The branch must implement a remediation programme subject to independent validation.

The regulator also required fit-and-proper reassessments of the chief executive officer and chief compliance officer, extending the enforcement action beyond financial penalties to scrutiny of their suitability for their roles.

4. Mumtalakat and ARP secure in-principle approval for Bahrain AI-native wholesale bank

Bahrain Mumtalakat Holding Company, the kingdom’s sovereign wealth fund, and ARP Group, the holding company of ARP Global Capital and ARP Digital, announced a partnership to establish an AI-native, blockchain-enabled wholesale bank headquartered in Bahrain. The proposed institution has received in-principle approval from the Central Bank of Bahrain but must obtain final authorisation before commencing regulated operations. It intends to serve financial institutions, payment companies and businesses with cross-border operations.

ARP Group chairman Yusuf Alireza said institutional clients with complex cross-border needs still faced “fragmented banking services”. The proposed bank would combine a regulated balance sheet and institutional relationships with AI and blockchain-enabled services connected to clients’ systems through application programming interfaces. ARP Digital previously developed a Bitcoin-linked structured investment with National Bank of Bahrain in 2024. Products and services would be introduced in phases following engagement with prospective clients.

5. FAB’s nine-month pre-tax profit rises 5% as net interest income grows 11%

First Abu Dhabi Bank (FAB) reported a 5% year-on-year increase in nine-month profit before tax to AED 20.22 billion ($5.51 billion), while operating income rose 7% to AED 29.71 billion ($8.09 billion). Loans and advances increased 10% year-to-date to AED 679 billion ($184.89 billion), compared with 5% growth in customer deposits to AED 885 billion ($240.98 billion). Net interest income rose 11% to AED 16.98 billion ($4.62 billion), while the non-performing loan ratio improved to 2.1%.

Higher business volumes and improved margins drove FAB’s net interest income growth, according to the bank. Net interest margin was 1.93%, up five basis points year on year. FAB reported a liquidity coverage ratio of 140% and a common equity tier 1 ratio of 14.0%. Non-interest income contributed 43% of operating income, although its 3% growth was slower than the 11% increase in net interest income.

6. Mashreq’s nine-month pre-tax profit rises 18% on operating growth and impairment releases

Mashreq reported an 18% year-on-year increase in nine-month pre-tax profit to AED 7.3 billion ($1.99 billion), while operating income rose 11% to AED 10.4 billion ($2.83 billion). Customer lending grew 33% year on year to AED 190.6 billion ($51.90 billion), compared with 27% deposit growth to AED 237.1 billion ($64.56 billion). The non-performing loan ratio improved to 0.7%, while the cost-to-income ratio stood at 31.4%.

The profit increase reflected both underlying operations and lower credit costs: operating profit growth contributed AED 635 million ($173 million), while a shift from an AED 366 million impairment charge to an AED 116 million net release added AED 482 million ($131 million). Customer deposits increased AED 32.2 billion year-to-date, exceeding the AED 26.3 billion rise in loans, while current and savings accounts represented 58% of deposits. Mashreq also raised international term funding during the third quarter.

7. UAE’s Etihad Credit Bureau extends scoring to new-to-credit borrowers and recent residents

Etihad Credit Bureau launched Credit Score 3i, extending its assessment of individual credit behaviour from 24 to up to 36 months and introducing separate models for established borrowers and eligible individuals with limited credit histories, including those new to credit or newly resident in the UAE. The models use scoring ranges of 300–850 and 300–650, respectively.

The expanded framework could widen access to financing by helping lenders assess borrowers with limited credit histories. It can also reflect sustained improvements in credit behaviour within six months after defaults are settled, depending on subsequent repayment behaviour and the individual’s overall credit profile.

8. Arada raises $400 million as UAE property debt issuance resumes

UAE property developer Arada completed a $400 million five-year senior unsecured sukuk issuance, marking the first international debt offering by a UAE real estate developer since the regional conflict began in February 2026, according to the company. The sukuk carried an 8.875% coupon, below initial price guidance of 9.375%, and attracted a final order book exceeding $700 million.

Arada plans to use part of the proceeds for a tender offer of up to $180 million of existing sukuk ahead of a $411.7 million maturity in June 2027. Pricing 50 basis points below initial guidance suggests demand helped improve its borrowing terms, although the 8.875% coupon still represents a substantial financing cost.

9. Oman and China sign currency swap agreement and deepen digital finance cooperation

The Central Bank of Oman and the People’s Bank of China signed a currency swap agreement on 2 November during Sultan Haitham bin Tarik’s state visit to Beijing. The countries also signed a memorandum of understanding on central bank digital currencies, alongside agreements covering securities and futures regulation and the digital economy. China is Oman’s largest trading partner, with bilateral goods trade reaching $36.73 billion in 2024, dominated by Chinese purchases of Omani crude oil.

The countries linked closer financial cooperation to facilitating bilateral trade and investment. The separate CBDC memorandum provides for exchanging expertise and experience: Oman is piloting CBDC use cases, while China has an established digital-yuan operating network spanning domestic payments and cross-border trials. The cooperation gives Oman access to experience relevant to its own assessment of digital-currency design and implementation.

10. Arab Bank Group’s nine-month profit rises 10% as non-interest income grows 11%

Arab Bank Group reported a 10% year-on-year increase in net profit after tax to $902 million for the first nine months of 2026, compared with $818 million a year earlier. Total assets increased 5% to $81 billion, while customer loans rose 4% to $42.5 billion and deposits grew 6% to $59.3 billion. The capital adequacy ratio stood at 17.4%.

Chief executive Randa Sadik attributed the earnings growth to an 11% increase in non-interest income, reflecting the group’s efforts to diversify revenue and reduce reliance on interest margins. Deposits grew faster than loans, supporting a 72% loan-to-deposit ratio, while non-performing loan provision coverage remained above 100%.

What to watch

The Central Bank of the Republic of Türkiye Inflation Report (12 November), Jordan–EU Investment Conference (19 November), and Central Bank of the Republic of Türkiye Financial Stability Report (27 November).