The Madbouly government is NOT liquidating NIB, only restructuring it: The state-owned National Investment Bank (NIB) is not being liquidated, Ashraf Negm, Vice Chairman and MD of NIB, said in a statement (pdf) this morning, refuting a news report in Al Borsa (pdf) that was based on an IMF review (pdf). We picked up the story earlier this week and were unsuccessful at the time in obtaining comment from the NIB or the Planning Ministry.

Where did the notion that the development bank was being liquidated come from? The IMF said in its recent review of reforms agreed as part of Egypt’s USD 5.2 bn standby loan program that the country was setting out to “reduce fiscal risks [in part by] winding down the National Investment Bank (NIB), a publicly owned development bank.” The government agreed with the Fund to come up with a plan to mitigate risks posed by the bank’s financial position. A Deloitte audit commissioned by the government has not been made public, so it is unknown how much the bank actually owes.

So what’s happening with NIB? “Work is currently underway to implement a plan to restructure the bank, which the government announced three years ago,” the statement said. The main elements of the bank's restructuring focus on rescheduling and paying down the bank's obligations according to a clear and agreed timetable, Negm noted. The plan will see NIB resolve “financial entanglements” with government institutions. “Part of these entanglements has already been completed with a number of government institutions, whereby the bank acquired a number of high-value assets,” Negm added.

Beyond external obligations, NIB is planning on restructuring internally with an eye towards maximising the value of its assets. With that in mind, NIB will undergo an administrative restructuring in the upcoming period.

CLARIFICATION- In our story earlier this week on NIB, we quoted Prime senior economist Mona Bedeir on factors that may have resulted in the financial position inherited by NIB’s current management team. Neither Prime nor Bedeir provided data or other information for the story — which, as we clearly noted, was first broken by Al Borsa based on the IMF’s review document (above). Prime has asked to “clarify that Mona Bedeir’s comment was limited only to the analytical aspect in terms of dissolving the entanglements between the Ministry of Finance on one hand and the Ministry of Public Enterprise on the other hand. She did not provide any comment on the technical management of National Investment Bank or the management of its assets. Prime apologizes if any offense was taken.”