CI Mortgage has offered EGP 900m in mortgage finance, and aims to increase its financing portfolio to EGP 1.5bn by the end of this year, Nagy Fahmy, Managing Director of the company, has told Daily News Egypt.
The company also seeks to capture a larger market share, despite the challenges facing the activity, especially high interest rates, which represent a challenge to all non-banking financial activities.
He stressed that the company aims primarily to maintain the quality of its financing portfolio without stumbling, while pumping funds conservatively during the coming period due to the current challenges of an inflationary environment and high interest rates, indicating that the default rate in the company’s portfolio does not exceed 1%.
He pointed out that recessions usually affect all non-banking financial activities, but they directly provide more investment opportunities that have some financing sectors, such as micro and consumer activity, especially since they are the most beneficiaries.
He pointed out that there is a diversity of investment alternatives such as certificates, dollars, and gold, which have reduced the luster of real estate investment, and are no longer an investment destination, noting that certificates are less investment-oriented because they do not match the sharp rise in inflation rates.
He pointed out that the real estate finance market is witnessing some challenges in light of the decline in retail customers, especially in light of the successive interest rate hikes by the Central Bank of Egypt to absorb inflation.
Regarding the possibility of securitization, Fahmy believes that securitization operations are a good financing alternative for non-banking financial activities, but the real estate financing activity still needs more expansion in pumping funds by companies so that companies can reach a financing portfolio that accepts securitization.
Fahmy added that the most prominent challenges facing the real estate finance industry in Egypt is that the real estate developer plays the role of the real estate financier by providing the service of installment units over years, sometimes up to 14 years, which impedes the growth of the real estate finance industry, stressing that this challenge changes market shape.
