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EFG Hermes Holding takes major stake in aiBANK

Anna Lyudvig
Nov. 18, 2021, 10:01 a.m.
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EFG Hermes Holding has finalized its acquisition of a 51% stake in the Arab Investment Bank (aiBANK), marking a strategic entry into the fast-growing and solid Egyptian commercial banking sector. 

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EFG Hermes Holding has finalized its acquisition of a 51% stake in the Arab Investment Bank (aiBANK), marking a strategic entry into the fast-growing and solid Egyptian commercial banking sector. 

The transaction will see EFG Hermes Holding assume control of aiBANK, with TSFE Financial Services & Fintech Subfund, a subfund fully owned by the Sovereign Fund of Egypt, EFG Hermes Holding’s valued partner, acquiring a 25% stake.

“The closing of this landmark transaction with our esteemed partner TSFE will drive the transformation of our Egyptian operations into a universal bank with an investment bank, a commercial bank and a fast-growing Non-Bank Financial Institutions (NBFI) platform, ensuring that we can provide a holistic set of financial products and services to both retail and corporate clients alike in our home market,” said EFG Hermes Holding’s Group CEO Karim Awad.

“In Egypt and across a dozen other frontier emerging markets, we continue to be the region’s premier investment bank franchise with market leading shares of trading across most of our markets and active roles in a number of recent regional transactions like the IPO of ACWA Power on Tadawul and Fertiglobe on ADX among many others,” he added.

According to Awad, the completion of this acquisition should be looked at as another step towards building a business model that can withstand the cyclicality of capital markets and increase synergies creation potential across the EFG’s platform.

“Our efforts to geographically diversify our business means that we are now present in 13 countries with the ability to offer financial services to more than 1 billion people living and doing business in some of the world’s fastest-growing markets.  The addition of a commercial bank in our home market also means that EFG Hermes Holding (through its different subsidiaries and brands) can provide its Egyptian clients with a single destination for all their financial services,” he said.

Over the past few years, EFG Hermes Holding has transformed itself from a pure play MENA investment bank into an Egyptian universal bank, offering its corporate, retail and institutional clients sell-side services and investment solutions.  

In addition, in Egypt, EFG Hermes Holding offers its clients buy-now pay-later (BNPL) fintech (valU), microfinance (Tanmeyah), leasing and factoring (Corp Solutions), insurance (Kaf Takaful), e-payments (PayTabs Egypt), mortgage finance (Bedaya) and soon a comprehensive range of saving and lending products (aiBANK). 

“Our ability to cross-sell across this expanding network of financial services has only increased during the past years as we continue to grow each of our business lines and to play our role in increasing financial inclusion and job creation across FEM,” Awad said.  

“It has also cemented our firm belief that this business model will reap great benefits for our shareholders by providing greater visibility on profitability and future dividend distribution as well as potentially significant upside through contemplated partial exits of some of our growing subsidiaries,” he added.

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