Ramsco's Women Empowerment Initiative Recognized Among Top BRICS Businesswomen Practices for 2025    Egypt, Elsewedy review progress on Ain Sokhna phosphate complex    Gold prices end July with modest gains    Pakistan says successfully concluded 'landmark trade deal' with US    Egypt's FM, US envoy discuss Gaza ceasefire, Iran nuclear talks    Modon Holding posts AED 2.1bn net profit in H1 2025    Egypt's Electricity Ministry says new power cable for Giza area operational    Egypt's Al-Sisi, Italian defence minister discuss Gaza, security cooperation    Egypt's FM discusses Gaza, Nile dam with US senators    Aid airdrops intensify as famine deepens in Gaza amid mounting international criticism    Health minister showcases AI's impact on healthcare at Huawei Cloud Summit    On anti-trafficking day, Egypt's PM calls fight a 'moral and humanitarian duty'    Federal Reserve maintains interest rates    Egypt strengthens healthcare partnerships to enhance maternity, multiple sclerosis, and stroke care    Egypt keeps Gaza aid flowing, total tops 533,000 tons: minister    Indian Embassy to launch cultural festival in Assiut, film fest in Cairo    Egyptian aid convoy heads toward Gaza as humanitarian crisis deepens    Culture minister launches national plan to revive film industry, modernise cinematic assets    Rafah Crossing 'never been closed for one day' from Egypt: PM    I won't trade my identity to please market: Douzi    Two militants killed in foiled plot to revive 'Hasm' operations: Interior ministry    Egypt's EHA, Huawei discuss enhanced digital health    Egypt, Oman discuss environmental cooperation    Egypt's EDA explores pharma cooperation with Belarus    Foreign, housing ministers discuss Egypt's role in African development push    Egypt reveals heritage e-training portal    Three ancient rock-cut tombs discovered in Aswan    Sisi launches new support initiative for families of war, terrorism victims    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Egypt's Irrigation Minister urges scientific cooperation to tackle water scarcity    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



HDB completes capital increase, eyes expansion
Published in Daily News Egypt on 23 - 06 - 2010

CAIRO: Egypt's Housing Development Bank (HDB) completed a capital increase worth LE 480 million, raising its issued capital to LE 1.15 billion from LE 670 million.
“Simply, the bank had to grow with the market in order to compete,” Fathy El-Sebai Mansour, HDB's chairman and managing director, said at a conference Monday, adding that the bank will use the money to “expand and strengthen our capacity for further growth.”
In the last four to five years, “all small banks have been driven out of the market through mergers and acquisitions. [Moreover] the new law sets the minimum capital of a bank at LE 500,000 million,” Mansour said.
Investment banks HC Securities and CI Capital worked together to administer the public issuance and the distribution of the securities.
“The increase in the capital of the bank, which started at LE 54 million in 2003 and has now reached LE 1.15 billion, would have not been possible had it not been for the improving financial performance of the bank,” said Hussein Choucri, chairman and managing director of HC Securities and Investment.
“The banks profits have increased 10 times over the last five years,” he added.
In 2010, the bank assets grew 7.5 percent compared to the end of 2009. HDB's loan portfolio reached LE 5.9 billion at the end of March 2010, an increase of 1.3 percent compared to the end of 2009.
Working with more
One of the main advantages of the capital increase is that it will allow the bank to grant credit and market loans to larger companies.
“Before, the bank could only grant one customer a maximum of LE 188 million. This will rise to LE 450 million following the completion of capital increase and with this increase comes the bank's ability to negotiate with more important clients,” said Mansour.
The bank's statement also said that the capital increase will support property rights within the bank increasing the standard of capital, which allows the bank to increase credit limits.
“The capital increase will also make it easier for the bank to comply with Basel II capital adequacy requirements giving the bank an appropriate degree of autonomy on the one hand and maintaining banking stability on the other,” the statement added.
HDB was established as an Egyptian joint stock company in 1979 with an initial authorized capital of LE 3 billion. At the time of its launch, HDB's key mandate was to finance housing units. The bank conducted mega developments in new urban communities and invested in Egypt's North coast resorts in the late 1980s.
HDB currently owns companies specialized in real estate and development and mortgage finance, which focus on higher income luxury housing units and compounds. It is also working on a national housing project for Egypt's low-income segment.
HDB plans to finance new projects in the coming years with the development of lending activity through the marketing and sale of units of new housing projects. “We have very profitable land that is currently being developed and we expect large revenues in the future,” Mansour explained.
“To insure same returns to stockholders in the long run, we have also invested in diversified range of real estate and development firms,” Mansour said, including a stake in the Egypt unit of Dubai-based Damac Holding as well as a stake in Sakan Finance.
The emergence of larger banks with advanced technology, years of banking experience and streamlined administrations, Mansour said, prompted the bank to pursue a more vigorous expansion strategy.
“We have 57 braches now and we want to reach 100 by 2013. We will develop more advanced banking systems and compete with our products both through competitive pricing and quality,” Mansour added.
In a statement, the bank said that the decision for the offering came in light of its “financial strength outstanding performance and high growth rates.”
Securing securities
“The success of any offering is based on the success story of the firm behind it. The bank's accomplishments make people trust that the bank will be able to accomplish its goals,” said Karim Helal, group CEO of CI Capital Holdings.
“We are proud that two of the biggest investment companies in Egypt have worked together to insure the success of this offering,” added Helal.
The debt crisis in Greece which was accompanied by negative effects on the global stock markets and the subsequent deterioration of the financial markets and investors' confidence both abroad and in Egypt, unfortunately, coincided with the announcement of the offering, according to the statement by the bank.
“Consider that at the time of the offering the stock market was falling 7 percent with the Greece crisis affecting investors and markets in Egypt and abroad,” Choukri said.
According to the bank's statement, despite the unfavorable financial context, the offering was covered 1.5 times.
The bank attributed this to the trust in the stability of the bank attracting greater domestic and foreign investment from both new and existing investors. The bank said that it had received more than 1.3 billion requests for subscription mostly from new investors, prompting the bank to allocate each subscriber only 80 percent of the total shares subscribed for increasing the share of individual investors and institutions at the expense of government agencies.


Clic here to read the story from its source.