The board of directors of the Egyptian Agricultural Bank (EAB), chaired by El-Sayed El-Kosayer, decided to form a committee to supervise its investment funds.
The committee includes deputy chairperson Samy Abdel Sadek, deputy head of the Egyptian Association for Finance and Investment Mohsen Adel, and securities expert Mohamed Hussein.
El-Kosayer said that the committee will focus on developing the performance of the bank’s three subsidiary funds and follow up on their work with the companies currently managing them, next to revising their financial situation, preparing marketing plans, and studying the establishment of new funds.
The EAB, in partnership with Banque du Caire, owns the Al Wifaq Investment Fund, which offers cumulative periodic interest in accordance with Sharia law.
The fund was established with a capital of EGP 100m and is being managed by HC Securities.
This fund aims to maximise its profits by investing in shares of companies, financial instruments, and Sharia-compliant investment securities.
The fund’s investments are limited to the local market, while it follows several mechanisms: it is only allowed to invest 90% of its liquidity in shares on the Egyptian Exchange. The fund can also only channel 70% of its investment to other Sharia-compliant securities, or 50% in short-term cash instruments.
The fund holds 10% of its funds in cash. It can also invest these funds in low-risk investment channels that are convertible into cash on demand such as Islamic investment accounts.
The second fund owned by the bank is the Diamond Fund, which is a balanced capital fund with a capital of EGP 100m and managed by Hermes Investment Fund Management.
The fund follows policies aimed at maximising profits through diversification of investments policy, choice of equities, short- and long-term fixed-return investment instruments, and short- and long-term variable return instruments.
The fund’s investments are divided between 60% fixed-rate instruments, applicable to reach 100%, and 40% only allowed for equities and global depositary receipts.
The third fund is the money market daily cumulative return fund Hassad. This one was as well founded with a capital of EGP 100m and is being managed by HC Securities.
The fund invests in short-term investments, such as treasury bills, bonds, bank deposits, financing instruments, savings certificates, and other debt instruments issued by the government, next to repurchase agreements at the Central Bank of Egypt, and certificates of investment of other cash funds.
It follows an investment policy aimed at achieving a cumulative daily return on invested funds, at a rate that is commensurate with the nature of the low risk fund. It also provides liquidity through daily subscription.
