EGYPT Law and Practice Contributed by: Mahmoud S. Bassiouny, Iman Nassar, Habiba Gamaleldin and Israa Mostafa, Matouk Bassiouny
If the applicant is a foreign bank, the consent of the regulatory authority in its jurisdiction must be obtained to allow for the co-operation and shar - ing of information between the CBE and such authority. The CBE must reply to the applicant within 60 days; if approval is given, the applicant must finalise the acquisition within six months of the approval date. In accordance with the CBE circulars, the appli - cant is responsible for notifying the CBE if they become aware that any documents or informa - tion submitted during the application process were inaccurate, incorrect or have changed. Additionally, the applicant must provide any necessary information to the CBE whenever requested, until the application is complete. 4. Governance 4.1 Corporate Governance Requirements The New Banking Law and the Governance Instructions issued by the CBE on 23 August 2011 (“Governance Instructions”) must be read together as a comprehensive guideline for gov - ernance rules in the banking sector. In line with the Governance Instructions, the CBE issued the Governance and Internal Controls for Banks Circular on 17 September 2024 to enhance gov - ernance practices and internal control systems within the banking sector. This circular is divided into two sections: (i) governance, which defines the roles and relationships between the bank’s board, management, shareholders, and other parties; and (ii) internal control, which empha - sises the importance of monitoring and review - ing all bank activities and operations. Further, the CBE also issues regular circulars addressed to the senior management and boards of directors of banks to provide instructions on certain mat - ters of corporate governance.
Banking professionals are guided by extensive principles of corporate governance, notably outlined in the CBE’s August 2011 circular. This circular emphasises the importance of trans - parency, confidentiality, and trust in all bank - ing activities, reinforcing a robust framework of standards that governs the industry. 4.2 Registration and Oversight of Senior Management The appointment of senior executives in banks must be approved by the Governor of the CBE in accordance with Article 120 of the New Banking Law. Senior executives are defined as chairper - sons, board members and executive directors of core and oversight activities as specified in detail by the board of directors of the CBE. The approval of the Governor is necessary for vetting the technical competence and capabilities of the candidate prior to appointment. The senior executives must observe the follow - ing principles in performing their roles: • complying with the laws and regulations, and exerting the due care required for their profession; • co-operating with the CBE and reporting any incidents of material breach; • supervising and ensuring that operations are efficient within their departments and del - egating their powers to competent person - nel, although a senior executive will remain responsible for any matters delegated to others; and • providing information to clients with transpar - ency and avoiding any conflicts of interest. A board member of any bank must not simulta - neously be a board member of any other bank or credit agency. Additionally, a member cannot participate in management or consultancy activ -
176 CHAMBERS.COM
Powered by FlippingBook