An Egyptian court has quashed Sunday the central bank’s decision to put a time limit on the tenures of chief executives of commercial lenders.
Sunday’s verdict by the administrative court in Cairo declared void a nine-year time limit for CEOs of commercial banks in Egypt, a decision which was taken earlier in March and launched a purge of several top executives that puts it on a likely collision course with the country’s banking sector.
To help modernise the sector and “inject new blood”, chief executives of public and private banks as well as the heads of foreign banks operating in Egypt would have to step down after nine years, Tarek Amer, a central bank governor, announced in a statement earlier on March 23. He also added that both consecutive and non-consecutive CEO terms would count towards the nine-year limit.
The decision to cap CEO terms caused consternation among bankers who described it as an unexpected overreach into the private sector’s affairs.
The decision had threatened eight top executives to resign their positions, including Commercial International Bank’s Hisham Ezz al-Arab and Arab African International Bank’s Hassan Abdalla.
The lawsuit to nullify the central bank’s decision was filled by both Mounir Yassin – a member in the Commercial International Bank’s general assembly; and Ibrahim El-Salamony, a lawyer who owns stakes in several private banks in the country.
