Daily News Egypt

EFG-Hermes chief sees big opportunities in Saudi Arabia - Daily News Egypt

Advertising Area




Advertising Area



EFG-Hermes chief sees big opportunities in Saudi Arabia

Reuters SHARM EL-SHEIKH, Egypt: The chairman of Egypt-based investment bank EFG-Hermes said on Monday its newly obtained Saudi license was crucial to growth because it expands the company s market four times over. Saudi accounts for over 75 percent of the total fee pot of the Arab world. So whatever we are doing today we …


Reuters

SHARM EL-SHEIKH, Egypt: The chairman of Egypt-based investment bank EFG-Hermes said on Monday its newly obtained Saudi license was crucial to growth because it expands the company s market four times over. Saudi accounts for over 75 percent of the total fee pot of the Arab world. So whatever we are doing today we are doing within 25 percent of the fee pot. … You can extrapolate from what I am saying the impact on the company, Yasser El Mallawany told Reuters in an interview. EFG-Hermes, which now has operations in Cairo and Dubai, plans to set up a Saudi office initially with 35 key personnel, doing brokerage and custody as well as investment banking. It s a very strong market with a very wide industrial base and a strong corporate family ownership. All kinds of investment banking activities can be done there, including mergers and acquisitions, he added. The company is also expanding into Lebanon this year and plans to start operations next year in Jordan and an unnamed Gulf country, said Mallawany, speaking on the margins of the World Economic Forum on the Middle East in Sharm El-Sheikh. The meeting of 1,200 business people concentrated on regional business integration of the kind represented by EFG-Hermes, which has a multinational leadership and has acted as a bridge between the Egyptian market and Gulf investors. Mallawany said the recent decline in Gulf markets had some advantages for his company. Declines affect bottom lines of course, but when you go into a market when there is a euphoria or a bubble, your valued added becomes negligible. But when you come to a market when there is a volatility and a correction, then you can add value, he said. EFG-Hermes has benefited strongly from the government s privatization program in its home market Egypt, which has slowed down a little after a burst of activity in 2005. It made a net profit of LE 350 million ($60.7 million) in 2005, up from LE 52 million in 2004. But Mallawany said he expected the pace to pick up again soon. The slowdown has only been for the last few months or so … I think it will start gaining steam and momentum again, he said. The privatization of Bank of Alexandria, which the government plans to complete by the end of the year, will help reactivate the process. It s going to be a turning-point, a substantiation of the drive to proceed with (the sale of) sensitive assets, he said. He said that investors looking at Egypt give relatively low priority to the political uncertainties. President Hosni Mubarak, 78, has no clear successor. The country has seen a series of protests in solidarity with judges seeking independence and a series of bombings have made some dents in the valuable tourist industry. On a scale of 10, it (political uncertainty) takes three or four. Maybe succession is more relevant. They (investors) want to understand more the process. I think they are considering some constitutional amendments, he said. The government has said it plans to make constitutional amendments this year but not to the system for presidential elections. Under the present arrangements, only the ruling National Democratic Party could be sure of fielding a presidential candidate.

Topics: FJP

Advertising Area

Advertising Area



https://www.dailynewsegypt.com/2006/05/23/efg-hermes-chief-sees-big-opportunities-in-saudi-arabia/
Breaking News

No current breaking news

Receive our daily newsletter
Subscribe