The National Bank of Egypt (NBE) aims to achieve 15-20% growth in its various sectors this year, Vice Chairperson of the NBE Yehia Aboul Fotouh said.
He told Daily News Egypt that the bank aims to channel more financing to small and medium-sized enterprises (SMEs) and retail loans.
The bank’s loan portfolio reached about EGP 570bn at the end of December 2019, EGP 90bn of which were in retail loans, which represents about 12%. The bank aims to increase this figure to EGP 100bn by the end of this year, through expanding the bank’s contribution to the Central Bank of Egypt’s (CBE) initiative to finance low-income housing, credit cards, personal loans, and other retail products.
The CBE’s decision to increase the debt-to-income ratio for personal loans to 50% from 35% would surge the demand for such loans.
The bank pumped about EGP 62.3bn to finance SMEs, of which EGP 55.2bn are direct facilities for 72,000 customers, and EGP 7bn were indirect facilities. Moreover, funds worth EGP 36.8bn were granted to about 45,200 customers under the CBE’s initiative to support such projects.
The bank aims to increase the portfolio of this sector to EGP 100bn by the end of the current fiscal year in June 2020.
With regard to mortgage financing, Aboul Fotouh said the NBE ranked first among banks participating in the CBE’s mortgage finance initiative which was launched in 2014.
He pointed out that the bank pumped EGP 8bn worth funds for this sector, including EGP 7.7bn under the CBE’s initiative to 80,000 customers, of which 96% were allocated for low-income citizens.
“The NBE aims to expand in financing the industrial sector, in light of the CBE’s initiative launched in 2019 to support the sector,” Aboul Fotouh said.
The CBE, in cooperation with the government, decided to allocate EGP 100bn for medium and large industrial projects whose sales amounted to EGP 1bn annually, at a decreasing interest rate of 10%, through long or short-term loans according to their needs. The priority will be given to industries that provide alternatives for imported products.
The NBE aims to acquire the largest possible share of that initiative. “We hope to grant EGP 150bn in financing this important sector, not just EGP 100bn,” Aboul Fotouh said.
On a different note, he said the NBE would expand in the non-bank financial services significantly in the coming period.
Al Ahly Capital Holding, the investment arm of the NBE, recently announced its acquisition of Pharos Securities Brokerage. The company also approached acquiring Pharos Promoting and Underwriting, Pharos Asset Management, and Pharos One Fund, which are all expected to be completed this month.
Aboul Fotouh said the acquisition of Pharos is part of the NBE’s plan to establish an integrated investment bank, through the National Capital Holding, denying any negotiations to acquire other companies at the present time.
Regarding the bank’s geographic expansion, he said that the predetermined plan was to open 50 branches annually, pointing out that the bank’s branch network reached 500 branches last year.
In 2019, the bank opened six electronic branches, and there was a plan to bring this number to 25 branches by the end of 2020, in line with the state’s financial inclusion strategy.
The bank’s electronic branches are in City Stars, Point 90 Mall, Mall of Arabia, City Center Alexandria, City Center Almaza, New Giza, and two branches are being prepared in City Center Hurghada and City Center Ismailia.
The selection of the branches’ locations followed certain criteria, including the appropriate geographical location, the target segment of customers, the age group, and other factors. He pointed out that the services offered in those branches are currently at their first stage, and more services to follow according to the bank’s study of the market, local, international changes, and the needs of customers.
Electronic branches provide many services, such as issuing prepaid payment cards and bank statements, updating thedata, subscribing to Al Ahly Net service, iPhone Cash wallet, and opening new accounts for new and existing customers.
Customers can also benefit from a package of services through the ITM machines, located in these branches, where the customer can withdraw cash with a maximum of EGP 30,000, make cash deposit with a maximum of EGP 50,000, and deposit checks for collection.
These branches would also provide the service of collecting checks issued by other banks, issuance of checkbook, and printing account statements in the coming period.