The National Bank for Development (NBD) called on banks holding Islamic licenses to participate in granting an Islamic loan of $120 million to the East Delta Electricity Production Company (EDEPC).
Some of the banks expected to participate in the loan include Alwatany Bank of Egypt, the Egyptian Gulf Bank and United Bank.
The loan’s period is five years and is a Mudarabah loan, one of several non interest-bearing Islamic financial instruments. The loan will be used to finance expansions at the electricity production station in Damietta.
In mid 2011, EDEPC received financing of EGP 4.6 billion from 14 local banks. The financing covered 85.4% of the investment cost of EGP 5.5 billion total, needed to install 12 additional electricity-generating units—8 units for Elshabab station in Ismailia and 4 units in the Damietta station. The expansions are part of a Ministry of Energy and Electricity’s project to address the pressure on the electrical grid during the summer season.