Hussein Refaie, Chairperson and Managing Director of Suez Canal Bank, said that the bank’s strategy aims to turn it into the strongest banking institution providing electronic services in the Egyptian market.
In an exclusive interview with Daily News Egypt, Refaie affirmed that the bank attaches great importance to financing the corporate sector and major projects, whether national or investment ones with economic feasibility, in a way that serves the national economy and provides job opportunities.
What are the main features of the bank’s business plan for this year?
During the coming years, the strategy aims to move the bank towards a new stage, by focusing on expanding investment bank services, non-banking financial services, and supporting the small and medium enterprises sector and the retail banking sector to enhance the concept of financial inclusion. This will be done while continuing to focus on supporting and financing major companies, and adopting a focus on digital transformation within the framework of the directions of the state and the banking sector.
We also seek to expand electronic banking activity, so that the bank will be one of the strongest banking institutions that provide all electronic services or government payments to its customers, and attract a new segment of young people that rely on electronic transactions.
What are the most important areas that will be focused on during this year?
The bank’s strategy targets the development of digital services and products, in line with the latest developments in the field of financial technology, the development of the infrastructure to accommodate digital transformation, the employment of artificial intelligence to improve services, and the development of the internal work system. With the application of advanced protection standards through the latest means and programs of protection and insurance in financial technology, to ensure the provision of high levels of security for digital services, and adherence to local and international standards in the field of digital payments and digital transformation, within the framework of the state’s policy towards digital transformation and financial inclusion.
How could the Bank support the Egyptian economy?
The Egyptian economy is moving steadily towards achieving the goals of the economic and structural reform program, foremost of which is the implementation of reforms aimed at advancing the growth rate and containing the budget deficit and inflation rates. This, in turn, was reflected in the improvement of economic indicators and was highly praised by international institutions.
The bank finances the corporate sector and major projects, whether national or investment ones, that have economic feasibility, in a way that serves the national economy, provides job opportunities, and stimulates economic growth.
The bank participated in financing part of the projects of the Suez Canal Economic Zone in order to complete the infrastructure works and develop the ports of the authority. This is in support of the state’s plans aimed at maximizing and strengthening the role of the Suez Canal Economic Zone as a pivotal logistical center in the global trade movement, and to achieve maximum benefit from the promising capabilities and potentials enjoyed by this unique strategic region that connects the east and west of the world. The development of this region aims to find new investment opportunities in all sectors, and to settle new industries in an effort to reduce the volume of imports, and to enhance local production that meets the needs of the Egyptian market.
The bank also participated with 10 of the largest banks in the banking sector in a syndicated loan granted for the purpose of expanding and developing the new port of Abu Qir. In addition to his participation in the loan granted for the purpose of financing part of the investment cost of establishing the largest sugar industry factory in the Middle East and reclaiming 181,000 feddan of desert lands west of Minya governorate. This represents one of the practical solutions to provide part of the needs of the local market in terms of sugar, wheat and corn products, which are considered one of the strategic commodities and contribute to reducing the gap between supply and demand between commodities.
What are the most important economic sectors that the bank will focus on financing?
We attach great importance to financing the corporate sector and major projects, whether national or investment, that have economic feasibility in a way that serves the national economy, provides job opportunities, and stimulates economic growth.
The bank also contributes to providing syndicated loans within banking alliances in strategic sectors including oil, electricity, real estate development, contracting, food industries, and reinforcing steel.
What are the most important opportunities and challenges in the banking sector?
The global economy faced many shocks and challenges the likes of which it had not witnessed in years, starting with the coronavirus pandemic and the lockdown policies, to the Russian-Ukrainian conflict, which overshadowed the world with unexpected economic repercussions.
This has caused an exit of foreign investors’ capital, in addition to an increase in commodity prices. In light of this, reform measures have been taken to ensure economic growth. In order to support the goal of price stability in the medium term, the deposit and lending rates have been raised by 800 points over the past year. This came with the aim of containing the resulting inflationary pressures, as the Central Bank of Egypt uses its monetary tools to achieve the goal of price stability.
All indications confirm that the Egyptian banking system is huge, developing, and protecting monetary and financial stability in the Egyptian market.
The Egyptian banking sector is expected to witness more growth and stability. This confirms its continuation during the past years to work well and achieve high growth rates in most fields, despite the political and economic conditions that Egypt and the region are exposed to.
And all the results give the Egyptian banking sector a certificate of trust and appreciation that confirms its global worth, and its wisdom in building a strong sector capable of supporting the economy, including institutions and individuals, in light of crises and emergencies.
The application of the strategies of the Central Bank of Egypt contributes to enhancing the financial solvency of banks and the effectiveness of management and governance of all types of risks, and taking appropriate precautionary measures. This led to maintaining financial support and high capital requirements that exceed the prescribed minimum, as well as high liquidity ratios, which reflects positively on the economy as a whole.
Also, the banks operating in the Egyptian market possess strong financial solvency and ability to overcome different crises. The digital revolution initiated by Egyptian banks made them a fierce competitor to their global counterparts, and strengthened the base of bank customers and increased the use of banking transactions.
The Egyptian banking sector is also considered one of the strongest economic sectors in the country, and they always support the economy to rise and withstand crises. The local market is also attractive to international banks and international entities to enter and invest due to its banking strength and wise leadership.
However, the financial crises that the economy is going through are considered one of the biggest challenges facing banks. This is because banks, by the nature of their work, depend on funds and financial liquidity in particular and mainly.
Also, there are market-specific risks, such as fluctuations in interest rates, fluctuations in exchange rates, and fluctuations in securities prices, which push banks to resort to high-cost sources of funds.