At the core of the Egyptian banking sector evolution lies a surge in mergers and acquisitions (M&A) activity. As the country pursues ambitious economic reforms and digital modernization, banks have emerged as pivotal players—not only in capital mobilization but also in expanding financial inclusion and investor confidence.

The Central Bank of Egypt (CBE) views a modernized, concentrated financial sector as central to achieving Egypt Vision 2030 goals. This vision calls for banks to evolve from traditional lenders into digitally empowered financial powerhouses.

Recent years have seen deals reflect a broader trend: the convergence of traditional banking with fintech, microfinance, and investment services. At the same time, interest from Gulf banks and global investors underscores Egypt’s growing appeal as a financial hub, even as some players like HSBC reevaluate their retail banking footprint.

Egypt’s Financial and Banking Landscape

Egypt’s financial sector is undergoing a dynamic transformation, fueled by regulatory reform, digital innovation, and strategic consolidation. The CBE continues to play a pivotal role in stabilizing the monetary environment and promoting financial inclusion.

According to the CBE’s July 2025 bulletin, the sector has seen steady growth across key indicators, including credit expansion, deposit mobilization, and digital payment adoption.

The total assets of Egypt’s banking sector reached EGP 20.4 trillion at the end of 2024, up 45.8% from the previous year. This figure represents 125.4% of the country’s nominal gross domestic product (GDP) and 93.5% of the total assets of the financial system. Assets continued to rise, reaching EGP 22.7 trillion in March 2025, the CBE’s data showed.

Egypt has 38 licensed banks, including both public and private institutions, as well as branches of foreign banks. As of June 2025, the consolidated financial position of banks operating in Egypt (excluding the CBE) reached EGP 24.023 trillion, up from EGP 22.673 trillion in March 2025, marking a quarterly increase of EGP 1.35 trillion and underscoring the sector’s strong growth.

Banking Reforms and M&A Push into Fintech and Digital Ecosystems

The CBE has positioned the banking sector at the heart of its reform agenda, particularly through initiatives that promote digital transformation, operational efficiency, and financial stability.

Karim Ragab, a financial banking and non-banking expert, tells Arab Finance: “Egypt’s banking sector has consistently emphasized the importance of maintaining and strengthening its financial ties with Arab and international institutions. This unity and cooperation are essential to ensuring Arab integration and regional stability.”

“Furthermore, recent regulatory and monetary reforms, led by the CBE Governor Hassan Abdalla, have supported the stability of the foreign exchange market and initiated a trend toward interest rate cuts,” Ragab adds. “Combined with the political stability Egypt has enjoyed since the election of President Abdel Fattah El-Sisi, these factors collectively enhance the confidence of Gulf and international investors in the country’s financial landscape.”

In October 2025, the CBE launched the Banking Reform and Development Fund, a legally independent entity designed to enhance the global competitiveness of Egypt’s banks. The fund focuses on technological advancement, cybersecurity, and financial literacy—key pillars for building a resilient and modern financial system.

Banking M&A in Egypt has historically been driven by institutional consolidation and regulatory reform. “Despite the challenges facing emerging markets globally, Egypt continues to stand out as one of the region’s most attractive investment destinations,” Ragab explains.

“With a population exceeding 110 million and a strong base of human capital, Egypt serves as a key resource hub for the Arab world. The country’s deep-rooted economic and diplomatic relations with Gulf and Arab nations reinforce this attractiveness, as investors seek stability and long-term growth opportunities,” he notes.

This activity has included both domestic, Arab, and international players, resulting in major transactions such as Attijariwafa Bank’s acquisition of Barclays Egypt, the sale of Société Générale’s stake in National Société Générale Bank, and the merger of Bank Audi Egypt into First Abu Dhabi Bank (FAB). Recent trends suggest this foundational M&A activity is set to increase, highlighted by the CBE’s strategic move to privatize assets like the United Bank.

Egypt’s banking sector continues to emphasize the importance of maintaining and strengthening its financial ties with Arab and international institutions. This unity and cooperation are essential to ensuring Arab integration and regional stability.

Recent regulatory and monetary reforms, led by Hassan Abdalla, have further supported the stability of the foreign exchange market and initiated a trend toward interest rate cuts. The scope of the Egyptian banking sector is no longer confined to traditional financial services.

In recent years, M&A has increasingly bridged the gap between banks and adjacent, high-growth sectors like fintech, insurance, and digital payments. This strategic convergence is exemplified by Abu Dhabi Islamic Bank Egypt’s (ADIB Egypt) acquisition of a minority stake in a local fintech firm in 2024. The takeover marked a critical move to integrate Sharia-compliant digital services and expand reach among younger, tech-savvy consumers.

“Banking and technology have become two of the most influential forces shaping the modern economy. The global shift toward digital and tokenized forms of money is transforming conventional banking systems and influencing how financial institutions operate and engage with clients,” according to Ragab.

“Likewise, the insurance sector is rapidly adapting to technological advancements—introducing digital policy issuance, automated services, and enhanced cybersecurity frameworks—to address the risks associated with data protection and cyber threats. These cross-sector developments across banking, fintech, insurance, and digital payments reflect a global move toward integrated, technology-driven financial ecosystems,” he continues.

Reshaping International Presence

While domestic consolidation and digital expansion accelerate, a simultaneous, opposing force is reshaping the international presence in Egypt. As part of an ongoing global strategy to simplify operations, HSBC Group is conducting a strategic review of its retail banking business in the country. This is part of a systemic withdrawal from retail operations in multiple international markets, a strategy that has been accelerating since mid-2023.

Crucially, this review affects solely the retail segment. The bank’s wholesale side, which includes commercial and institutional banking units, remains core to HSBC’s strategy in Egypt and is not impacted. For the time being, the retail unit continues to operate as the bank considers all available options.

As per Ragab, “HSBC’s decision to review its retail banking operations in Egypt, with the possibility of focusing more on wholesale banking, global markets, and investment-related activities such as HSBC Securities and MCSD, reflects both a global strategic realignment and the competitive dynamics of the local market.”

“Egypt’s retail banking landscape is highly competitive, with numerous players operating efficiently at lower costs and successfully attracting large customer bases. This environment presents challenges for international banks with higher operational expenses, making strategic refocusing a logical step,” Ragab highlighted. “HSBC’s continued commitment to wholesale and investment banking activities underscores its confidence in Egypt’s long-term economic potential.”

Egypt’s banking sector stands at a transformative crossroads, where consolidation, digital innovation, and strategic realignment are converging to reshape the financial landscape.

M&A have emerged not merely as transactional events, but as strategic tools driving modernization, expanding financial inclusion, and reinforcing investor confidence. From domestic reforms to cross-sector integration with fintech, insurance, and digital payments, the sector is evolving into a dynamic ecosystem.

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