Egypt’s FRA doubles insurers’ investment cap in commodity, metal funds

Egypt’s Financial Regulatory Authority (FRA) has raised the maximum share of funds that insurance and reinsurance companies can invest in commodity and metal investment fund certificates to 10 per cent, up from 5 per cent. The move aims to diversify investment options for insurers and boost market liquidity.

Under Resolution No. 123 of 2025, issued by FRA Chairman Mohamed Farid, the value of funds invested in a single fund must not exceed 5 per cent of the insurer’s total allocated investment funds or 15 per cent of the fund’s net asset value, whichever is lower.

The updated rules amend FRA Resolution No. 2 of 2025 and apply to investments in commodity and metal funds or other instruments backed by metals and traded on the Egyptian Exchange. The decision is part of efforts to deepen the market, enhance stability, and strengthen investor confidence by ensuring a balance between return maximisation and protection of policyholders’ rights.

The move follows recent decisions requiring private insurance funds to invest part of their capital in open-ended funds focused on stocks listed on the Egyptian Exchange, to be managed by FRA-licensed professionals.

These reforms are being implemented under the Unified Insurance Law No. 155 of 2024, the first comprehensive legislation for the sector, replacing four earlier laws. Moreover, it empowers the FRA board to set policies and procedures governing the sector, supporting Egypt’s plans to digitise financial services, promote financial technology, and expand insurance coverage.

Attribution: Amwal Al Ghad English
Subediting: M. S. Salama

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