Led by Egyptian executive Karim Awad, EFG Hermes plans to increase its capital base by $52.9 million

EFG (Egyptian Financial Group) Hermes Holding, a Cairo-based financial services group, announced on Thursday, April 7, that it is increasing its capital base by EGP970 million ($52.9 million).

According to the board of directors of the Egyptian financial services provider, the decision to raise additional capital through bonus share distribution will result in the group’s total issued capital reaching EGP5.83 billion ($317.8 million).

EFG Hermes Holding is a financial services conglomerate based in the Middle East, North Africa, Sub-Saharan Africa and South Asia.

Since 2013, EFG Hermes has held leadership positions in securities brokerage, asset management, investment banking, private equity, and research under the leadership of Egyptian investment banker Karim Awad, the group CEO.

According to the scheme agreement, which will be funded by the group’s retained earnings, EFG Hermes will issue one share for every five shares held by shareholders as it increases its issued capital by EGP970 billion ($52.9 million).

The strategic capital raise will increase the group’s total issued capital to EGP5.83 billion ($317.8 million), up from EGP4.86 billion ($265 million) previously.

The recent announcement comes on the heels of the group’s strong financial performance at the end of its fiscal year 2021.

According to its earnings report for 2021, its consolidated net profit increased by 12% from EGP1.31 billion ($71.4 million) at the end of 2020 to EGP1.46 billion ($79.6 million), boosted by a 12-percent increase in revenue from EGP5.4 billion ($294.3 million) to EGP6.1 billion ($332.5 million).

The group’s earnings power and revenue were significantly boosted by a slower increase in operating costs driven by the management’s cost-cutting strategies, as well as the consolidation of Arab Investment Bank (aiBANK) following the acquisition of a 51-percent stake in the bank in Q4 2021.