Cairo-based Arab African International Bank (AAIB) and SANAD Fund for MSMEs, part of the German state-run Kfw Development Bank, are forming a new company to practice microfinancing activities in Egypt. AAIB has submitted the constitutional documents of the new microfinancing firm to Egypt's market regulator, the Egyptian Financial Supervisory Authority (EFSA). The new company is a joint venture between AAIB and SANAD Fund, in which they hold 70 percent and 30 percent stakes respectively, a senior source in the AAIB told Amwal Al Ghad on Wednesday. "We are currently outlining the credit policy and selecting the managing director of the new company." the AAIB source further said. The new company will be with an initial capital of 75 million Egyptian pounds ($4.2 million), to be later raised to 130 million pounds after one year from starting activities, the source added. Arab African International, which has assets of about $13 billion, was set up in 1964 as a joint venture between the Central Bank of Egypt and sovereign wealth fund Kuwait Investment Authority, with each party holding a 49.37 percent stake in the lender.
