NFO of Afaq fund closes, coverage exceeds target

Mahmoud El-Qassas
3 Min Read

The deadline for subscription in the new fund offer (NFO) of Afaq securities fund, which will invest the money of private insurance, pension, and insurance companies funds, ended last Thursday. It’s the second pension fund in the Egyptian market.

Mohamed Mostafa, managing director of the Arab African Investment Management, said the size of the offering will be announced on Monday.

He revealed that the coverage of the NFO subscription significantly exceeded the target capital of the fund of EGP 50m, according to the prospectus approved by the Financial Regulatory Authority in July, refusing to disclose more details.

Noteworthy, the Afaq fund was established by three financial institutions from within the civil aviation sector with a capital of EGP 5m, including the Civil Aviation Finance Holding Company (10%), the EgyptAir Holding Company, and its subsidiaries insurance fund for the employees (80%), and the private insurance fund for employees of the Ministry of Civil Aviation and its affiliates (10%).

A total of 450,000 policies were issued as part of the private placement of qualified institutions and investors at EGP 100 on 10 July for two months.

The fund is to be open for daily subscription, while the redemption shall be weekly with the announcement of the daily price of the fund’s policies, without subscription or redemption fees, while Banque du Caire will serve as the subscriber of the fund and the Arab African Investment Management as the fund manager.

Matouk Bassiouny is the legal adviser of the NFO, and Baker Tilly and Mohamed Nassef & Co will act as auditors.

The fund has an investment policy aimed at maximising the return on the invested funds, taking into account the reduction of investment risks by distributing the investment among various securities, where the maximum limit for investment in bonds and government treasury bills is 70%, deposits at 35%, 15% for securitisation bonds, and 20% for the money market and fixed income securities, in addition to 15% as a limit for listed shares.

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