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Wednesday, 29 November 2017

CIB signs USD 100 mn subordinated loan agreement with IFC, qualifies as tier-two capital

CIB signs USD 100 mn subordinated loan agreement with IFC: CIB signed an agreement (pdf) with the International Finance Corporation (IFC) yesterday for a USD 100 mn subordinated loan that qualifies as tier-two capital under recently amended central bank regulations. The loan carries a 10-year maturity and will not cause any dilution to equity, but will “enhance CIB’s already strong capital ratio from 18.05% to 19.10%,” supporting growth plans and hedging CIB from risk. The loan agreement is also in line with management’s current strategy “to explore and pursue all available avenues to ensure a sustainable, comfortable capital base that is less vulnerable to external factors.” Earlier this month, CIB signed a USD 100 mn subordinated loan agreement with the European Bank for Reconstruction and Development, which will also be added to its tier-two capital.

At the signing, IFC MENA regional director Mouayed Makhlouf reiteratedprevious statements that the institution will invest USD 1 bn in Egypt in 2017. The IFC’s Vice President of New Business Dimitris Tsitsiragos had said last month that this figure would increase to USD 1.5 bn in 2018.

In other IFC news, the corporation is investing EUR 15 mn in PE firm Mediterrania CapitalPartners’ Mediterrania Capital III fund and expansion into Egypt and West Africa, the IFC said in a statement on Tuesday. The fund, which will focus on small and mid-cap companies, will also invest in Algeria, Tunisia and Morocco. “We are expanding into new markets in Egypt and West Africa and are well placed to facilitate investment flowing from Europe to Africa to help investors capitalize on new growth opportunities,” said Albert Alsina, Founder and CEO of Mediterrania Capital Partners. Mediterrania Capital III is due to start operations at the end of November with EUR 103 mn at first close. Second closing is scheduled for July 2018 with a target of EUR 250 mn.

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