Reuters
Banque du Caire selling 45% stake
Emirates NBD doing due diligence
Egypt privatising state businesses
Emirates NBD, Dubai’s largest bank by assets, has begun due diligence ahead of buying a stake in Egypt’s sixth-largest commercial bank, Banque du Caire.
The purchase would be the latest sale of a government-owned asset in a stalled privatisation programme, according to regional media.
Egypt agreed an expanded $8 billion loan from the International Monetary Fund last year and hopes to raise up to $2.5 billion from privatising state-owned businesses during its 2024-2025 fiscal year as part of wider efforts to reduce its debt and revitalise its economy.
But earlier this week the IMF warned that “more decisive implementation of reforms will be critical” as it released a tranche of an extended fund facility to Egypt.
Emirates NBD is undertaking the due diligence on buying a stake in Banque du Caire, which is owned by state-owned Banque Misr and is Egypt’s sixth largest bank by assets, Kuwaiti newspaper Asharq Business reported. It cited unidentified sources who said a deal could be completed within six weeks.
Banque Misr wants to sell 45 percent of Banque du Caire for up to $1.2 billion, Egyptian outlet EnterpriseAM reported. The outlet said a further stake could be listed on Egypt’s bourse.
Banque du Caire had EGP478 billion ($9.4 billion) of assets as of September 30, its most recent financial statement shows, while Emirates NBD Egypt, which is wholly owned by its parent, had assets totalling $3.1 billion at the end of 2024. This makes it Egypt’s 20th-largest bank by assets, according to S&P Global Ratings data.
Banque du Caire and Emirates NBD Egypt have both reported rising profits thanks to a steep increase in net interest income following rate rises which have boosted lending margins.
Banque du Caire made a net profit of EGP8.6 billion in the nine months to September 30, nearly double that of the prior-year period, according to its financial statements. Emirates NBD Egypt made a 2024 annual net profit of EGP5.3 billion, up 64 percent on 2023.
Egypt’s benchmark interest rate has soared to 27.25 percent currently from 19.25 percent at the end of 2023.
Emirates NBD did not respond to requests for comment.
Last November, Fitch Ratings raised its credit rating on Banque du Caire to B from B- after making a similar upgrade to Egypt’s sovereign rating.
Egypt’s “real GDP growth is expected to pick up, inflation to decline over the next two years and the Egyptian pound exchange rate to remain broadly stable by end-2025”, Fitch wrote in a report.
