- First EBRD transaction in Egypt under its Solidarity Package to meet financing needs of existing clients
- Senior loan of US$ 100 million to QNB ALAHLI to support local businesses in need of short-term financing
- Additional US$ 100 million increase on the current trade finance limit
The European Bank for Reconstruction and Development (EBRD) is rolling out a programme in response to the economic impact of the coronavirus pandemic in Egypt, with a financial package for QNB ALAHLI, one of the country’s largest commercial banks, to support local enterprises.
This is the first investment to be delivered in the country under the EBRD’s coronavirus Solidarity Package, which was set up to meet the immediate short-term financing needs of existing clients.
The EBRD is extending a US$100 million senior loan to QNB ALAHLI for on-lending to firms, with a special focus on small and medium-sized enterprises (SMEs) that are experiencing a decrease in their activities, turnover and/or profitability. Small businesses form an important segment of the Egyptian economy and supporting them in these challenging times remains a priority for the EBRD.
In addition, the Bank is increasing an existing uncommitted trade finance limit for QNB ALAHLI by US$ 100 million under the EBRD’s Trade Facilitation Programme to reach US$ 250 million, to help meet the increased demand for import and export transactions.
Heike Harmgart, EBRD Managing Director for the southern and eastern Mediterranean region, commented: “We are very proud to roll out our swift support to the Egyptian economy by partnering with QNB ALAHLI. This financial package is key for the resilience of local Egyptian businesses – it will provide much-needed funding to SMEs, large enterprises and trade companies in this global crisis.”
Mohamed El-Dib, Chairman and Managing Director of QNB ALAHLI, said: “The latest transactions further show that the top priority of both the EBRD and QNB ALAHLI is to support clients through these challenging times, which is in-line with the Central Bank of Egypt directions to support SMEs projects. It also demonstrates the trust and confidence that we have built over the years, enabling us to continue our cooperation and deliver business even in the current crisis.”
QNB ALAHLI is one of the EBRD’s largest clients in the financial sector in Egypt. The bank has been a longstanding partner of the EBRD since 2015, when a first SME loan and a trade finance facility were signed.
The coronavirus pandemic and its economic impact present an unprecedented challenge to the regions where the EBRD invests. The Bank has rapidly stepped up its support with a response and recovery programme to help the 38 emerging economies where it invests.
The EBRD expects to dedicate the entirety of its activities to combating the economic impact of the crisis and stands ready to provide support worth €21 billion over the period 2020-21.
Egypt is a founding member of the EBRD. Since the start of its operations there in 2012, the Bank has invested over €6 billion in 115 projects in the country.