The Housing and Development Bank (HDB) continues its successful trajectory, achieving steady growth across all sectors during the financial period ending on 31 March 2024. As a result, it solidifies its position as one of the leading comprehensive commercial banks in the Egyptian banking market.
Hassan Ghanem, the CEO and managing director of the bank, expressed his pride in the bank’s ability to maintain its sustainable growth and achieve strong growth rates in terms of business results for all sectors during that period. He said that despite the current challenges, the bank was able to accomplish noticeable and accelerated growth rates.
Ghanem stressed the bank’s success in implementing its ambitious strategy, which places customer satisfaction at the top of its priorities, in addition to its ability to accommodate the aspirations of existing and new customers and meet their needs effectively.
He pointed out that as a result of this approach, the bank was able to expand its customer base and increase its market share.
Key highlights from the independent business results include:
- Net Profits Before Income Taxes and Allocations:
Independent business results showed a growth in net profits before income taxes and allocations, recording EGP 3.631bn, compared to EGP 2.017bn during the first quarter of 2023, an increase of EGP 1.614bn and 80%.
- Net Profits After Income Taxes:
Independent net profits after income taxes reached EGP 2.426bn, compared to EGP 1.325bn, an increase of EGP 1.101bn, with a growth rate of 83.1%.
Net operating revenues increased by 64%, reaching EGP 4.2bn during the first quarter of 2024, while net profits after allocations and income taxes increased to EGP 2.4bn, an increase of EGP 1.1bn, with a growth rate of 83% compared to EGP 1.3bn during the comparison period.
- Customer Satisfaction and Market Share:
The bank also continued to strengthen the confidence of its customers to invest in a variety of its products and services. This contributed to an increase in customer deposits by 5.2%, reaching EGP 106.5bn in March 2024, compared to EGP 101.3bn in December 2023, an increase of EGP 5.2bn.
This increase was driven by an increase in institutional deposits to EGP 59.3bn, with a growth rate of 7.6%.
- Diversified Portfolio and Financial Stability:
HDB has been keen on diversifying the portfolio of institutional deposits, given their role in reducing risks and enhancing financial stability, by directing deposits to a variety of sectors and companies to ensure the sustainability of the bank’s growth.
Additionally, he pointed out that the bank continues to reinforce its leading position in the Egyptian banking market, which in turn resulted in achieving sustainable growth for its assets. Total assets reached EGP 132.9bn in March 2024, compared to EGP 125.1bn in December 2023, an increase of EGP 7.8bn, with a growth rate of up to 6.3%, against the backdrop of the growth of the bank’s loan portfolio through the retail and corporate sectors where total loans reached EGP 48.5bn, with a growth rate of up to 6.6%. This was driven by the growth of the corporate and institutional loan portfolio to EGP 22.7bn, an increase of EGP 2.1bn, and a growth rate of 10.4%. The retail banking loan portfolio recorded EGP 25.8bn, an increase of EGP 866m, with a growth rate of 3.5%.
- Quality Financing and Non-Performing Loans:
The non-performing loans decreased to 6.7% in March 2024, compared to 6.9% in December 2023, which reflects the bank’s commitment to continuing to increase the volume of its financing, while maintaining the quality standards of the financing portfolio, and ensuring the diversity of financing from different sectors to ensure its sustainable growth. Moreover, the coverage rate increased to 120% compared to 114%.
The total loans to deposits ratio increased by 45.5% during the first quarter of 2024 compared to 44.9% by the end of 2023. He explained that the return on loans and similar income increased by 56.1% and the increase in the cost of deposits and similar costs was by 21%, which contributed to the increase in net income from the revenue reaching EGP 3.7bn compared to EGP 2bn, an increase of EGP 1.683bn, with a growth rate of 82.6%.
Ghanem explained that the bank achieved outstanding returns thanks to its effective strategies across various sectors. During the first quarter of 2024, net profits grew significantly, resulting in a return on average equity of 63%, compared to 50.5% in the same period of 2023. Additionally, the return on average assets increased to 7.5% (from 4.8%), marking a substantial growth of 56.03%. The capital adequacy rate stood at 22%, surpassing the minimum requirement set by the Central Bank of Egypt (CBE). Specifically, the capital adequacy rate for the first tranche reached 20.9%, while the second tranche accounted for 1.1%. These figures underscore the bank’s commitment to maximizing value for shareholders and related parties.
In the same context, Ghanem highlighted the impressive growth of the consolidated net profit for the bank, its subsidiaries, and sister companies. After income taxes, this figure reached EGP 2.8bn in March 2024, compared to EGP 1.3bn in March 2023—an impressive growth rate of 111%.
Supporting small and medium-sized enterprises (SMEs) remains a top priority in the bank’s strategy. Recognizing their role in driving development and job creation, the bank continues to align with CBE’s goals by directing 25% of its credit portfolio toward SMEs.
Regarding digital transformation, Ghanem emphasized HDB’s ambitious expansion strategy in this field. The bank witnessed a 9% increase in subscribers to Internet and mobile banking applications during the first quarter of 2024 compared to 2023. Additionally, the mobile wallet application saw a 10% rise in users.
Sustainability is a core focus for HDB. The bank actively follows sustainable practices and finances strategic projects that contribute to Egypt’s transition to a green economy and sustainable development. In the first quarter of 2024, EGP 3.3bn was allocated to sustainable financing across corporate financing, joint loans, and SME sectors—a growth rate of 22%. Creating sustainable value for all stakeholders remains both a strategic goal and a moral obligation.
In terms of social responsibility, HDB prioritizes health and education. The bank participated in building and launching the El-Sewedy and HDB Technical Academy in Sadat City, contributing EGP 12.5m. The academy aims to enhance the skills of young individuals, boost local production, and support industrial growth, aligning with Egypt’s Vision 2030.
Furthermore, HDB inaugurated the first two-room suite at Baheya Hospital in Sheikh Zayed under its name. The total contributions for this project amounted to EGP 21m, in collaboration with the Baheya Foundation—an organization specializing in early detection and treatment of breast cancer.
Despite challenges in the Egyptian economy, HDB remains flexible and professional. The bank’s management is confident in its ability to achieve strong financial and operational results. Guided by pillars such as customer prioritization, prudent risk management, and strategic expansion, HDB looks ahead with optimism and caution.
