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Egypt: NBK-Egypt Provides Finance of EGP 850 Million to Madkour for Projects Company

In line with its policy and directions towards supporting and financing national projects in Egypt, especially infrastructure projects, given their great importance in driving economic development, as well as its constant endeavors to support the State’s national project for developing Egyptian countryside villages, as part of “Decent Life” presidential initiative, National Bank of Kuwait - Egypt (NBK-Egypt) provided a finance of EGP 850 million to Madkour for Projects Company, one of the leading national companies in the field of energy and infrastructure projects, for the purpose of carrying out the works assigned to the company by the Ministry of Housing to replace and upgrade medium and low voltage electricity networks in some villages of Markaz Esna and Markaz Armant in Luxor Governorate.

The financing agreement was signed at NBK-Egypt’s head office on Monday, November 8, 2021, in the presence of Mr. Yasser El-Tayeb, NBK - Egypt Vice Chairman, Managing Director & CEO, where the agreement was signed by Mr. Amr El Alfy, Head of Business Group from NBK-Egypt’s side, and Dr. Mostafa Madkour, Chairman of the Board of Directors from the side of Madkour for Projects Company.

The signing ceremony was attended by Mr. Mohammed El Kerdany, Head of Islamic Finance, Mr. Helmy Youssef - Head of the Islamic Credit Unit in Cairo, Mr. Mohamed Mohie El-Din, Senior Credit Manager, Corporate Finance, Mr. Ahmed Allam - Credit Manager, Major Companies Finance, as well as a number of the bank’s senior and executive management members.

The signing was also attended from Madkour for Projects Company’s side by Eng. Tarek El-Sheikh – Managing Director, Mr. Emad El-Safty, Chief Financial Officer, Eng. Ahmed Ramadan, Head of Projects Division, and Mr. Tarek Shaaban, Head of Financing and Banking Relations.

On this occasion, Mr. Yasser El-Tayeb stated that NBK-Egypt’s financing of this mega project comes in line with its strategy to support the State’s plans in financing major national projects, especially electricity projects, given their great importance as the cornerstone of development in various areas of life, and the main driver of all economic activities.

This is instrumental to achieve inclusive development in all communities, as all countries of the world seek to secure their electricity needs, which prompted the Egyptian State to proceed strongly towards launching many mega electricity projects, especially after the June 30 Revolution in 2013 succeeded in putting an end to the frequent power outage, enabling Egypt to become a regional energy hub, which supports sustainable development goals in line with Egypt’s Vision 2030.

“On the other hand, NBK-Egypt’s initiative to finance this mega project stems from its direct positive impact on the daily life of citizens, especially people in the Egyptian countryside, and its contribution to improving their living conditions, in an effort to support the State’s national project for developing Egyptian countryside villages and improving the lives of citizens, as part of “Decent Life” presidential initiative,” El-Tayeb added.
On his part, Mr. Amr El Alfy mentioned that since several years, NBK - Egypt has been adopting a clear strategy to support and finance mega and infrastructure projects that help the State in its future plans to achieve progress and prosperity for all segments of the Egyptian people. Therefore, financing this vital project is a clear example for this strategy due to its great economic feasibility, as well as its key role in supporting the State’s development plans, driving production and securing more job opportunities for people.

Commenting on the deal, Mr. Mohammed El Kerdany said that arranging a loan of such a huge amount for this project reflects NBK – Egypt’s solid financial position and solvency enabling it to finance various mega projects, whether in individual or syndicated form, and also proves its confidence in the feasibility of this project and in the executing company, which is one of the leading contracting companies in this field in Egypt.

From his side, Dr. Mostafa Madkour expressed his pleasure with signing this agreement with a reputable bank like NBK - Egypt, which does not hesitate to provide the necessary financing for any vital projects that would serve the Egyptian economy and society. He also added that Madkour Group, as one of the leading national companies engaged in energy and infrastructure sector projects, with over 50 mega projects executed over the last five years, is proud of its contribution to the “Decent Life” project, which supports the Egyptian citizen and the economy, noting that NBK-Egypt’s contribution in these projects reflects its solid financial position and attention to different vital sectors of the Egyptian economy and society.

Meanwhile, Mr. Emad El-Safty affirmed that the company is committed to take part in supporting mega national projects with desired positive impact on  the Egyptian citizen, by providing people with a decent life marked by sustainable development for the neediest groups in the governorates of Egypt, highlighting that the success in arranging this finance demonstrates NBK-Egypt’s confidence in Madkour Company’s capabilities and leading position in implementing national projects.

On his part, Mr. Tarek Shaaban stressed that NBK-Egypt’s providing this financing to Madkour Company reflects its confidence in the company’s solvency, as well as technical and management capabilities, as it has become a key partner in the implementation of national projects. He also noted that and that this financing marks only the beginning of a more fruitful and effective cooperation and a positive partnership with the banking sector, since both the company and the bank are keen to contribute in development projects aiming to alleviate the burdens of citizens as part of the integrated efforts of development partners.
 

Egypt: NBK-Egypt reports EGP 4.021 billion (Equivalent to KWD 41.4 million) in net profit in FY2023

National Bank of Kuwait - Egypt (NBK-Egypt) has announced net profits of EGP 4.021 billion (Equivalent to KWD 41.4 million) for the financial year 2023, a significant increase from the EGP 1.826 billion (Equivalent to KWD 30.7 million) reported in 2022, showcasing an impressive annual growth rate of 120.21%.

Net Operating Income stood at EGP 8.66 billion, recording a substantial increase of 87.04% from the EGP 4.63 billion recorded in 2022. In the meantime, Net Interest Income jumped by 82.51%, reaching EGP 6.99 billion compared to EGP 3.83 billion in 2022.

On the other hand, Net Operating Income (excluding interests) increased to EGP 1.67 billion in 2023, compared to EGP 0.8 billion in 2022, up by 108.75%, while Cost to Net Operating Income dropped from 37.14% in 2022 to 28.02% in 2023.

Total assets reached EGP 130.61 billion in 2023, up by 24.22% compared to the year-end balance of EGP 105.14 billion in 2022. Furthermore, the net balance of loans and credit facilities expanded to EGP 76.06 billion 2023, reflecting a growth rate of 38.42% compared to EGP 54.95 billion recorded at the end of 2022. Moreover, customer deposits continued to grow, rising by 25.42% to reach EGP 105.93 billion in 2023, compared to EGP 84.46 billion by the end of 2022.

The Return on Average Assets (ROAA) surged from 2% at the end of 2022 to 3.4% at the end of 2023, while the Return on Average Equity (ROAE) increased from 16.9% at the end of 2022 to 30.7% by the end of 2023.

Commenting on the financial results announced by NBK-Egypt, Ms. Shaikha Al-Bahar, Deputy Group Chief Executive Officer, National Bank of Kuwait, and Chairman of NBK-Egypt, said: “In 2023, NBK- Egypt achieved its highest annual profits to date, accompanied by record growth rates. This success is credited to a strong operational performance, highlighting the resilience of our financial position and the flexibility of our business model, which allows for profit generation despite operational challenges.

“At NBK - Egypt, our objective is to enhance banking transactions and elevate their quality to meet growing market demand. We pursue this goal by focusing on the advancement of our digital services, leveraging the expertise and excellence of the Group in this domain. Additionally, we aim to expand our loan portfolio for SMEs, broaden the scope of our operations, and diversify them to encompass a wider geographical reach and cater to various customer segments,” Al-Bahar added.

Al-Bahar emphasized that Egypt stands as one of the key strategic markets for fostering the Group's business growth, consistently regarded as the second domestic market. Being the largest Kuwaiti investment in Egypt, the bank holds a significant presence in the Egyptian banking sector, evident in its rapid growth trajectory and strong financial performance. The Bank's positive momentum underscores its commitment to expanding further and strengthening its market position.

Al-Bahar also highlighted that the Group perceives the Egyptian market as a strategic long-term investment. Given that the Egyptian economy ranks among the largest in the region, it holds substantial growth potential once it regains momentum.

She further emphasized that Egypt represents a significant growth market, and that the Bank is committed to its continuous expansion. The operations in Egypt continue to be among the most profitable within the Group, boasting the highest rates of return on shareholders' equity and assets.

“As geopolitical tensions in the region subside, economic recovery efforts will receive a significant boost. By restoring confidence in the economy and currency, substantial opportunities will emerge. We maintain an optimistic outlook on future prospects, buoyed by the momentum generated from the Egyptian government and the Central Bank of Egypt's reform and exceptional measures,” Al-Bahar confirmed.

Meanwhile, Vice Chairman, CEO, and Managing Director of National Bank of Kuwait-Egypt, Mr. Yasser El-Tayeb, said: “The robust financial results and key indicators serve as the most compelling evidence, showcasing the Bank's capacity to maintain growth and attain favorable business outcomes throughout 2023, notwithstanding the unprecedented challenges faced both locally and globally. These challenges include the aftermath of the Russian-Ukrainian conflict, the Gaza war, import crises, and fluctuations in the foreign exchange rate against the Egyptian pound”.

El-Tayeb emphasized that NBK-Egypt maintains a well-balanced distribution of revenues across diverse business activities. This strategic approach is coupled with efficient operational rates and risk ratios, aligning with the dual objectives of achieving growth and ensuring business sustainability. Credit for this success is attributed to the Bank's prudent policies and a sound business model, demonstrating its capability to meet customer needs.

El-Tayeb further explained that the majority of NBK's income sources in Egypt are derived from credit operations in both the corporate sector and the rapidly expanding retail banking sector. The latter has notably increased in prominence, particularly in recent years, with a very diversified credit portfolio including a wide range of businesses across various sectors ranging from large scale corporations to SMEs. Meanwhile, the retail banking portfolio is also well diversified. This solid position reflects the Bank’s strength and the diversity of its revenue streams. He also highlighted that going forward, NBK-Egypt strives to further strengthen its position in retail banking by offering innovative services and products to its retail customers, in addition to continuing the horizontal growth plan by inaugurating new branches covering key locations throughout the Egyptian market.

Al-Tayeb also emphasized the Bank's firm belief in the pivotal role of technological advancements and electronic channels within the banking sector. Recognizing their significance in bolstering competitive advantages among banks, we, at NBK-Egypt have prioritized a robust expansion of our electronic banking services, making substantial investments in this area. Our ultimate goal is to provide customers with an exceptional banking experience, offering a unique facility that enables them to conduct the majority of their banking transactions conveniently, anywhere, anytime. Furthermore, we aim to encourage customers to utilize electronic means and channels for payments, aligning with the broader policy objectives of the state and the Central Bank of Egypt in this regard.

Furthermore, El-Tayeb highlighted NBK-Egypt's commitment to align its strategies with the global movement towards sustainable finance and the transition to a green economy. The Bank aims to actively support environmentally friendly projects that promote sustainability and the utilization of renewable energy sources to mitigate climate change, since sustainable financing has emerged as a fundamental mechanism and instrument for facilitating and maintaining enduring financial stability.

In terms of the bank's social responsibility, Al-Tayeb highlighted that since NBK Group entered the Egyptian market in 2007, NBK-Egypt has remained dedicated to serving the Egyptian community. This commitment is demonstrated through the support, donations, and contributions extended to numerous charitable organizations. Additionally, the Bank actively collaborates with reputable civil society institutions, establishing partnerships aimed at becoming the operational arm of the Bank's development initiatives.