SHARM EL-SHEIKH: Cash-rich EFG-Hermes, Egypt’s biggest investment bank, said it was seeking more acquisitions after buying a 65 percent stake in Lebanon’s Credit Libanais late last year.
The Cairo-based bank, which has up to $6.2 billion in assets under management, said it also was working to improve Egypt’s bonds market and hoped to take advantage of private-public partnerships being promoted by the government.
"We are looking at Africa. Africa is going to be our next move in the investment banking field. In commercial banking, Syria is a market that we are really interested in," Chief Executive Officer Yasser El Mallawany said in an interview.
Syria, which gave EFG-Hermes two investment banking licenses in April, is one of nine Arab countries where the bank operates.
"Syria is a very stable country, and the government is starting to be very serious to open up. We feel very safe in Syria," he told Reuters late on Tuesday.
After the sale last January of its 28 percent stake in Lebanon’s Audi Bank, EFG-Hermes said it had $1.2-$1.3 billion of spare capital it would use for purchases and to venture into new banking businesses.
It tapped this to buy a 65 percent stake in Lebanon’s privately owned Credit Libanais for $542 million.
Bonds, partnerships
Mallawany said his bank’s business would be boosted by improvements that are being made to Egypt’s bond market.
"We are spearheading this effort. We have already launched two bond offerings in 2010, Mobinil and OCI (Orascom Construction Industries). We have another backlog of bonds," he said. "In my opinion, in two to three years, it will represent a major revenue driving force."
He said the bonds market had become more appealing to foreign investors, encouraged by the listing of the OCI bonds.
He said EFG would also become more involved in public-private projects (PPP), especially in infrastructure.
Egypt has said it plans to offer billions of dollars worth of transport, energy and other projects in partnership with private firms over the next five years.
Mallawany said his bank’s assets under management had risen to $6.0-6.2 billion from $5.1 billion as of the end of June. He said it had more than $1 billion to invest in PPP via two of its private equity infrastructure funds, InfraMed and InfraEgypt.
"Infrastructure will be a main revenue driver and a main activity during the short to medium term for a lot of companies," he said.
Mallawany expected the Egyptian market to continue growing despite political uncertainty in the region and that two or three initial public offerings (IPO) would take place in 2011.
