Cairo, April 18, 2005
– The International Finance Corporation, the private sector arm of the World Bank Group, has signed an advisory services agreement with Banque Misr to extend the development of its micro and small enterprises operations to the bank’s branches in underserved areas of Eqypt.
The advisory services will help Banque Misr provide micro and small enterprises with investment and working capital financing. Banque MISR will extend loans to entrepreneurs who are unable to expand their businesses because of poor access to bank financing. The program starts this month and will run for a year. It will be managed by IFC’s regional advisory services program, the Private Enterprise Partnership for the Middle East and North Africa (PEP-MENA).
The agreement is the second between IFC and Banque Misr. A first phase, which targeted five bank branches, was successfully completed in October 2004. After 10 months of operations, those five branches had disbursed more than 6,000 loans with a total value of $3 million and a 100 percent repayment rate. As part of Banque Misr’s commitment to roll out the operation nationwide, the second phase will operate through 13 other branches of the bank, 10 in Upper Egypt and three in the Nile Delta region.
At the signing, Mr. Mohamed Barakat, chairman of Banque Misr said, “In line with our strategy, this continued cooperation with IFC will expand our micro and small business finance operations nationwide, helping reach our goal of contributing to the overall growth of the Egyptian economy.”
Jesper Kjaer, general manager of IFC’s facility, said, “Improving access to finance is a key component of our support strategy for micro and small enterprises. We are very pleased that IFC, through our PEP-MENA facility, will continue to support Banque Misr to serve better the financial needs of micro and small enterprises in Egypt.”
Banque Misr is Eqypt’s largest public sector commercial bank in terms of branches, with 456 nationwide. It is the second-largest in total assets, at $15 billion. Total shareholders’ equity amounted to $517 million asof June 2004.
PEP-MENA is a $100 million multidonor technical assistance facility managed and cofunded by IFC. It supports private sector development in the region, stretching from Morocco in the west to Pakistan in the east.
IFC’s mission is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY04, IFC has committed more than $44 billion of its own funds and arranged $23 billion in syndications for 3,143 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY04 was $17.9 billion for its own account and $5.5 billion held for participants in loan syndications.
