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EIB Signs Euro 375m Areement with NBE to Support SMEs in Egypt

Source: www.gulfoilandgas.com 7/27/2018, Location: Egypt

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The European Investment Bank (EIB) has signed a financing agreement worth EUR 375 million with the National Bank of Egypt (NBE) to fund investments by small and medium-sized enterprises (SMEs) and mid-caps in Egypt. The agreement is expected to sustain over 20,000 jobs in Egyptian firms.

The financing agreement comes under the EIB’s Economic Resilience Initiative, which aims at enhancing the prospects for more resilient and inclusive growth in Egypt through financial inclusion and the creation of sustainable employment opportunities, particularly for women and in less-developed areas.

The EIB’s finance, which comes with support from the European Union, will be channelled by NBE to finance the investment needs of enterprises in Egypt. A percentage of the financing will target firms owned or run by women (“women in business”) as well as enterprises located in less-developed areas of Egypt.

The finance is in line with the priorities of the Egyptian Central Bank and the European Union’s cooperation with Egypt. The European Investment Bank has granted a number of loans for SMEs and mid-caps in Egypt. Since 2009 it has provided financing of EUR 1.3 billion, most of which (56%) in the manufacturing sector. The projects concerned helped to sustain many thousands of jobs in private businesses. Additional financing for SMEs, such as the EUR 375 million to NBE, is continuously being made available in Egypt.

Established in 1898, NBE is the oldest commercial bank in Egypt and the largest player in the Egyptian banking sector. NBE is the market leader in terms of total assets with a total footing of approximately EGP1.5 trillion, a deposit market share of 28.7% and a loans market share of 28% as of December 2017.

NBE has a wide network of branches numbering 443 branches, offices and banking units nationwide. The Bank also enjoys an effective international presence in major financial centers.

Commenting on the signature, Flavia Palanza, Director of EU Neighbouring Countries at the EIB, said: “We are pleased to sign a new financing agreement with our longstanding partner in Egypt, NBE. The new agreement will help to provide the finance needed for private sector development in most governorates of Egypt. It will also seek to empower women and improve their access to finance. As the bank of the European Union, our aim is to contribute to building a stronger and more resilient economy in Egypt, as well as in the region, that creates more opportunities resulting in additional jobs and increased prosperity for the population.”

Hisham Okasha, NBE's Chairman, said: “We are glad to continue to see our partnership growing with European Investment Bank by signing this new financing facility amounting to EUR 375 million. This is a testament of our partner’s confidence in NBE’s management as well as the Egyptian economy. NBE’s policy continues to be geared towards supporting the private sector with special focus placed on the growing SME sector, where our portfolio has reached a high of approximately EGP 44Bn as of June 2018. This loan will assist in creating new job opportunities in the private sector as well as contribute to greater inclusion – both are among NBE’s key priorities.”

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