Shares in Egypt’s largest investment bank EFG Hermes rose 1.9 percent on the Egypt Exchange on Thursday after it acquired 51 percent of state-owned Arab Investment Bank (AIB).
The Sovereign Fund of Egypt also acquired a 25 percent stake, while the current owner, state-owned National Investment Bank (NIB), retained 24 percent, the fund and EFG Hermes said in a joint statement on Thursday.
For the latest headlines, follow our Google News channel online or via the app.
It was Egypt’s first bank privatization in more than a decade.
Under the transaction, new shares were issued to raise AIB’s capital to 5 billion Egyptian pounds ($319.9 million). EFG Hermes subscribed to new shares worth 2.55 billion pounds and the sovereign fund to shares worth 1.25 billion pounds, the statement said.
“AIB’s strategy will focus on serving small and medium enterprises as a driver for inclusion,” the sovereign fund’s CEO Ayman Soliman said in the joint statement.
“By upgrading its technological infrastructure, the bank will be better able to serve more customers, especially after the capital increase to meet the new banking law requirements.”
The AIB transaction is the first of many to come in the near future under a cooperation protocol that the fund signed with NIB, Soliman added.
NIB was established in 1980 to finance government projects. Egypt last year told the International Monetary Fund it would restructure NIB’s balance sheet through sales and swaps of assets, land, or shares in public companies to settle overdue debts.
Egypt’s EFG Hermes to acquire control of state-owned Arab Investment BankEFG Hermes Holding, Egypt’s biggest investment bank, will acquire 51 percent of state-owned Arab Investment Bank (AIB), the cabinet said in a ... Business
EFG Hermes expects to start factoring services in Q1 2018Egyptian investment bank EFG Hermes expects to begin offering factoring services in the first quarter of 2018 as part of a push into non-banking ... Economy
JP Morgan’s MENA equities head moves to EFG-Hermes: sourcesSadiq Hussain will remain based in Dubai and his replacement at the U.S. bank should be appointed by the end of June Banking & Finance
Egypt’s EFG seeks more investment banking revenue from abroadEFG Hermes, Egypt’s largest investment bank, wants to secure 60 percent of its investment banking revenue from abroad Banking & Finance