Cairo 23 Jan 2025:
Khalil Elbawab, CEO of Markets Division at Beltone Holding, praised the Financial Regulatory Authority’s decision to set a minimum of 5% for private insurance funds to invest in equity funds, highlighting the many benefits this decision brings:
Firstly, the decision enhances the diversification of private insurance funds’ investments, reducing the risks of focusing solely on fixed-income instruments, and allows the market to align with global trends in pension fund investments, which reached around 42% in 2023. Secondly, the decision helps enhance the Egyptian stock exchange by attracting additional long-term institutional investments. Moreover, this decision will enable private insurance funds to benefit from the high returns of stocks in the long term, thereby strengthening their ability to meet their obligations to members.
Additionally, countries with a younger demographic composition, such as Egypt, are increasingly directing their investments toward long-term channels like equities. This supports the national economy by promoting investments in local companies to foster their growth and create new job opportunities.
In this context, Elbawab considered this step an important measure to complement the ongoing efforts of the FRA in adding depth to financial markets, enhancing the efficiency of legislative frameworks, and adapting to new developments, all of which benefit the market as a whole.
