Regime change may have renewed hopes of a more democratic society in Egypt, but the health of the economy still hangs in the balance.
Commercial International Bank (CIB) and National Bank of Egypt (NBE) were in the spotlight this week as the ratings agency Standard & Poor's (S&P) assigned a "negative" outlook to both banks.
"We believe Egypt's authorities face challenges in managing the country's political transition and pressures on its fiscal performance," S&P said in a note.
A "prolonged deterioration" in the banks' operating environment was also factored in and was likely to hurt their stand-alone credit profiles, the note added.
It affirmed its "BB/B" rating on both banks, saying it perceived them to be less vulnerable in the near term but facing major uncertainties.
Egyptian banks closed for more than a week amid escalating violence on the streets of Cairo and other cities, costing the country at least US$310 million a day, according to the lender Credit Agricole. CIB fell 8.9 per cent to 36.49 Egyptian pounds on January 27, the last day of trade before the market was first shut down. NBE is a private company and is not traded.
The world's three biggest ratings agencies have either downgraded or placed "negative" outlooks on Egypt's sovereign rating alongside those of Tunisia, Jordan, Bahrain and Libya.
Any sharp deterioration in a country's creditworthiness has an immediate impact on the asset quality of its banks.
The cost of insuring Egypt's five-year debt soared to 450 basis points at the height of the protests that ultimately toppled Hosni Mubarak from the presidency.
The insurance cost now stands at 383.85 basis points, which is still far higher than for most other Mena jurisdictions including Abu Dhabi, Bahrain and Saudi Arabia.
S&P said it would lower the banks' ratings only if Egypt's sovereign rating fell or their asset quality or profitability deteriorated more sharply than expected.