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Monday, 2 January 2023

FRA tightens controls on follow-on lending to SMEs

DEBT-

State-owned Assiut National Oil Processing Company (ANOPC) secured a USD 2.9 bn loan to finance its new hydrocracking complex, according to a statement by the National Bank of Egypt, which acted as financial advisor and agent for the transaction. The 12-year loan is being extended by a consortium of international lenders including Credit Agricole, HSBC, Italy’s CDP and UniCredit, Societe Generale, and BNP Paribas. ANOPC was set up to build the mazut hydrocracking facility in partnership with Enppi, Petrojet, and Technip.

REGULATION-

Banks must send their customers account statements at least once every quarter, either in paper form or online, under a new directive (pdf) from the Central Bank of Egypt. The directive also lays out rules for lenders that are meant to ensure online banking services are secure and accessible. Banks have until 28 June to comply with the new rules.

FRA moves to tighten controls on SME follow-on financing: Lenders are no longer able to renew loans extended to small and medium enterprises (SMEs) without first ensuring that original loans have been paid in full, in a move to ensure that companies are not using fresh loans to repay existing ones, according to an FRA statement. SMEs can still take out a loan for a separate project while they are repaying existing loans, provided the type of loan is different and only after lenders have conducted due diligence to make sure borrowers’ financials are solid.

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