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Interest rate of Millionaire Certificate to jump to 10 percent

Thursday 06 December 2018 12:27 AM

Millionaire Certificate
Millionaire Certificate

By Sayed Badr
The United Bank, seeking to increase the interest rate of Millionaire
 Certificate by 700 basis point, is hoping to get the approval of the Central Bank of Egypt. 
" The interest will rise to 10 percent up from 3 percent now," board chairman and managing director of the United Bank told Al-Mal newspaper. 
The United Bank issued Millionaire Certificate back in 2001, and a sharia-compliant version of the certificate  in 2007, which is rolled out for free for each deposit of 100,000 EGP. 
Millionaire Certificate's monthly draws may generate prizes worth EGP4mln per year and have been increased 32 times. 
Draws on first EGP1mln prize take place first in January of every year and  secondly in July. Draws on EGP100,000 prize take place ten times a year, and 20 times a year for draws on EGP50,000 prize, all under the supervizion of Ministry of Social Solidarity. 
The certificate, available for Egyptians and foreigners, may be issued against  EGP100  for free with a five-year maturity that may be renewed automatically. Retrieving is permissible only  six months after the issuance of the certificate in accordance with CBE's guidelines. 
" Clients bought Millionaire certificates worth EGP80mln with the United Bank aiming to edge up savings to EGP500mln," he noted, shrugging off the cancellation of its prizes and annual draws in response to raising the interest rate by 7 percent to 10 percent. 
The United Bank, founded in 2006 upon the merger of the three banks of the Egyptian United Bank and the Islamic Development Bank, is owned by the Central Bank of Egypt by 99.9 percent, as CBE mulls divesting itself from UB whose restructuring  needs first to  fare well. 
The United Bank,  rebounding in terms of financial performance this year, seeks to score 20 percent growth in profits and operation next year, he explained. 
" UB's profits reached EGP950mln during the first nine months of current year and aims to increase profits by 20 percent up from  a year earlier when the bank recorded EGP1.067bn profits."