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EFG Hermes Leasing, HSBC team up to finance capital expansion of SMEs Agreement supports CBE initiative to strengthen sector, raises its contribution to formal economy
EFG-Hermes Leasing, a wholly owned subsidiary of investment bank EFG Hermes, has signed a collaborative agreement with HSBC Bank Egypt to boost small- and medium-sized enterprises' (SMEs) expansions. The deal will help SMEs get access to EGP 400m in leasing and financing services in 2019, the financial leasing and advisory services provider said in a statement. The collaboration agreement provides additional support to the government's and the Central Bank of Egypt's (CBE) initiative to reinforce the SME sector, which is the mainstay of Egypt's economy, EFG-Hermes Leasing added. It highlighted that the SME sector is estimated to generate a significant percentage of the nation's gross domestic product (GDP). "The core of the collaboration agreement is to provide SMEs with low-interest rate funding access to medium and long-term financing for capital expenditure and the ability to streamline cash flows," the statement added. The deal will provide innovative financing solutions for a slew of SMEs in the Egyptian market. "This agreement comes in line with the CBE's initiative, and is part of our group-wide initiative that saw us grow the contribution of SMEs in our portfolio to 16% compared to the 6% seen in 2017," he added. In May EFG Hermes Leasing launched a dedicated programme to target partnerships with suppliers that facilitate SME financing solutions, the statement noted. Commenting on signing the collaboration agreement, Helmy Ghazi, managing director and head of Global Banking, HSBC Egypt, said, "This agreement demonstrates our commitment to Egyptian SMEs, and our ability to deliver the right mix of products, quality of service, and international reach to support SMEs seeking to grow domestically and internationally." "We are very excited for this opportunity to combine our experience with that of HSBC Egypt to deliver innovative financing solutions for various SMEs in the local market," said Ahmed El-Kholy, EFG Hermes Leasing CEO. HSBC Egypt had previously launched SMEs Growth Funds in 2015 and 2016, totalling EGP 600m, and doubled its balance sheet commitments to SMEs in 2017.
