By Hossam Mounir
The Industrial Development and Workers Bank of Egypt aims to increase its loans portfolio by around EGP 1bn by the end of 2015, according to El-Sayed El-Kosayer, Chairman and Managing Director-Executive.
El-Kosayer said this increase would be to fund various economic sectors.
In an interview with Daily News Egypt, El-Kosayer added that the bank works on increasing the facilities granted to the large companies sector by EGP 650m. At the same time, it seeks increasing the volume of the granted loans to the retail, and small and medium-sized projects sectors by up to approximately EGP 350m.
What is your expansion plan for the bank’s activity in the next period?
The management targets achieving growth rates of no less than 25% in the different activities of the bank by the end of the year.
And what are the details of this plan?
As for the deposits portfolio in local and foreign currencies, it currently amounts to EGP 1.9bn, and we seek to increase it to reach around EGP 3bn by the end of 2015. In order to reach that goal, the bank issued lately a number of saving certificates, in pounds and dollars, suitable for all categories of citizens. Their returns are attractive, in order to attract the citizens’ savings, and work on maximising and diversifying the money sources in the bank. Regarding the loans portfolio in the bank, it is divided into three categories. First, the loans of large companies, which amount to about EGP 2.5bn by the end of last May. We aim to increase them to EGP 3bn by the end of this year.
The second category is the loans of small and medium-sized projects, of which its loans portfolio reached about EGP 500m. As for the third category, it is the retail banking, of which its loans portfolio amounts to around EGP 230m. We aim at increasing the volume of the loans directed to these two sectors by around EGP 350m, to allow the total volume of these two portfolios to reach EGP 1bn by the end of 2015.
What is the last situation of the troubled debts in the bank?
Since the new management took office in September 2011, the debts of roughly 175 clients, amounting to EGP 700m, were rescheduled, and they are more than 35% of the troubled loans portfolio. The bank was able to collect around EGP 250m in cash through this rescheduling, which were re-pumped into the bank’s activity. We target other treatments for about 20% out of the troubled loans portfolio by the end of this year. By doing so, we would settle half of this portfolio.
Would the faltering clients benefit from the initiative the Central Bank of Egypt (CBE) launched lately to support the faltering factories?
They definitely would. This initiative will help the bank to support the factory owners who faltered for reasons beyond their control. Moreover, it will give the bank more flexibility to negotiate with them, which will have positive consequences on the clients and the bank.
What is the percentage the industry sector acquired out of the bank’s portfolio?
The bank seeks to fund and serve the different economic activities, reaching the notion of the comprehensive bank almost completely. However, as a bank that was launched to serve the sector of industry, this sector acquires about 55% out of the loans portfolio in the bank.
What is your targeted profit for this year?
The bank is targeting EGP 100m profit by the end of the year, after the taxes and allocations, after it was recording losses over several years in the past. The bank targets to completely close the allocations gap before the end of the year as well.
Did the bank participate in the initiative of the real-estate finance that the CBE launched in February 2014 to fund people with low and medium-sized income?
Yes, the bank participated in this initiative, through which the CBE aims at providing housing for medium and low-income people, in addition to activating the real estate sector as well as the rest of the related sectors. The bank launched a specialised unit for real estate finance, of which 150 cases were funded and studied through, with more than EGP 15m.
What are the plans of the geographical expansion the bank follows?
The bank currently has 17 branches; most of them are in the industrial zones in areas of 10th of Ramadan City, 6th of October, Borg El-Arab, El-Sadat, and Sohag, in addition to the branches of Cairo, Alexandria, Port Said, Tanta, Fayoum, Assiut, Qena, and Damanhur. Soon, we will open a branch in Helwan. Moreover, we launched a bid to build a branch in the industrial city of Quweisna. We also study opening three mini-branches to support the initiative the CBE launched, previously, which aims at spreading out the banks over all the country in order to execute the concept of financial inclusion.