EFG Hermes Targets Minority Stakes in Start-ups after AIB Acquisition

Egyptian Investment Bank "EFG Hermes" said on Sunday that it is targeting minority stakes in emerging companies "Start-ups" after it acquired a majority stake in the state-owned Arab Investment Bank (AIB), according to CEO Karim Awad.

The Egyptian cabinet approved on Wednesday the the Sovereign Fund of Egypt and EFG Hermes’ acquisition of state-owned Arab Investment Bank (AIB).

Hermes, which is Egypt’s biggest investment bank will acquire 51% of AIB and the Sovereign Fund will also acquire a 25% stake in AIB, while the state-owned National Investment Bank will keep 24%.

He added that EFG Hermes would use internal resources to buy new shares of the AIB worth EGP 2.55 billion.

This is the first privatization of Egypt since 2006, when it sold a majority stake in Bank of Alexandria.

"We do not enter the banking sector to compete with the major banks operating in Egypt. Instead, we seek to find a part of the market to focus on to provide services to help it grow," Awad said.

Awad said the new owners would keep all existing AIB employees, yet, would consider a possible change in the bank's name.