The Leading Financial Services Corporation in FEM

Over its 35-year history of success, EFG Hermes has gone from one milestone to the next. From a leading Egyptian investment bank to a fully integrated financial service provider with presence in 13 markets across four continents — EFG Hermes has evolved not only to match shifting market dynamics but evolving stakeholder needs. The Firm leverages its expansive on-the-ground presence across the world, an ever-expanding portfolio of services, and commitment to driving shareholder value to cement its leadership position across some of the world’s most rapidly growing markets.

What We Do

For 35 years, EFG Hermes has been a leading financial services provider across frontier emerging markets (FEM). Through its two platforms, the Investment Bank and Non-Bank Financial Institutions, EFG Hermes is able to consistently bring innovative products to the table, offering a comprehensive service portfolio to meet the evolving needs of its growing base of institutional investors and retail clients. During 2019, the Firm further expanded its presence across fast-growing and increasingly attractive markets, becoming the first FEM investment bank to establish an on-the-ground presence in Vietnam.

Founded in 1980 as an Egyptian advisory firm, EFG Hermes quickly expanded to become a full-fledged investment bank by 1996. Through organic growth, strategic mergers and acquisitions, and a lateral business strategy, EFG Hermes has transformed itself into a leading financial services corporation with a diverse product range, encompassing both traditional investment banking services as well as non-bank financial services.

The Investment Bank

Securities Brokerage

EFG Hermes Securities Brokerage offers its client base, be they individual retail investors or some of the most prominent institutional investors and high-net-worth-individuals, an unrivalled coverage of over a dozen and frontier emerging markets. Today, the division stands as the leading brokerage house in both the MENA region and across the wider FEM space, with on-the-ground presence in Egypt, Kuwait, the UAE, Saudi Arabia, Oman, Jordan, Pakistan, Kenya, Nigeria, Bangladesh, and Sri Lanka.

The year saw the division open a new office in Vietnam, becoming the first FEM investment bank to establish an on-the-ground presence in the country. Throughout 2019, EFG Hermes continued to strengthen market shares across its footprint, ranking first on the Egyptian Stock Exchange (EGX), the Abu Dhabi Exchange (ADX), both the Dubai Financial Market (DFM) and NASDAQ Dubai, and the Kuwaiti Stock Exchange (KSE). The division completed its second FEM IPO following the successful offering of ASA International in 2018, demonstrating the Firm’s ability to bookbuild and transact in FEM, and completed advisory on EFG Hermes’ first cross-border M&A transaction in East Africa. During the year, the team also executed its first trades in Poland and South Korea and continued to add significant clients to its roster as it looks to further expand coverage and deploy new on-the-ground teams to cover equities in promising FEMs.

Investment Banking

Since the division’s launch in 1995, EFG Hermes’ Investment Banking has climbed the regional rankings to become a leader in M&A advisory, equity capital market (ECM) executions, and debt capital market (DCM) capabilities. Leveraging its ability to tap a global client base and utilize its unrivalled network of MENA clients to raise demand for compelling opportunities, the division continued to execute a growing number of transactions across an expanding global footprint. In 2019, the division posted yet another year of record-breaking transactions worth a total of USD 33.6 billion despite geopolitical volatility. Over the last twelve months, the division acted as a joint bookrunner on Aramco’s record-breaking USD 29.4 billion IPO, advised on two LSE listings by non-MENA headquartered companies, and continued to thrive in its core Egyptian market, capturing 100% of ECM deals in the country. During the year, EFG Hermes Investment Banking worked to further cement its position as a market leader and innovator, successfully issuing both Egypt’s first short-term securitization transaction and first short-term bond transaction, both of which fall under the new Short-Term Debt Instrument (STDI) decree published by the Financial Regulatory Authority (FRA) in 2018.

Asset Management

EFG Hermes Asset Management is the MENA region’s largest asset manager serving an increasingly diverse client base including multinational corporations, endowments, foundations and family offices, but with a continued focus on long-term and institutional clients. The division offers a wide array of tailored products including mutual funds and discretionary portfolios with both country-specific, regional, conventional, and Sharia-compliant mandates. As of year-end 2019, the division recorded over USD 1.5 billion in regional AUM and more than EGP 16.3 billion in the local Egyptian market. During the year, the division launched its new FIM Global Sukuk Fund, a further testament to the team’s ability to launch new, diversified products in response to the changing needs of its client base.

Private Equity

EFG Hermes Private Equity today is widely recognized as a leading player in the field with an unparalleled ability to raise money from around the world to invest across the MENA region and Europe. The division invests across a wide spectrum of sectors with a specific focus on renewable energy, education, and healthcare. Through its Vortex platform, EFG Hermes currently invests in a 365 MW solar PV farm in the UK. During 2019, the division successfully reached financial close on the divestment of Vortex I and Vortex II, which together held a 49% stake in a 998 MW pan-European wind energy portfolio, demonstrating EFG Hermes’ ability to acquire, manage, and exit renewable energy investments. In the coming year, Vortex Energy will embark on the next stage of its journey as it looks to invest in renewable energy projects across Europe, the US, and Latin America. During 2019, the division also completed the second closing of its Egypt Education Fund, bringing the fund’s total commitments to around USD 133 million. The fund is part of a wider platform established in partnership with GEMS Education, one of the world’s leading providers of education services, which will see USD 300 million invested in Egypt’s vital education sector over the coming three years. Finally, EFG Hermes’ Rx Healthcare Management announced its first investment in the Egyptian pharmaceuticals space through the acquisition of a leading Egyptian medical solutions provider, United Pharma.

Research

EFG Hermes Research is the leading provider of real-time, high-quality coverage of MENA and FEM markets. The division brings together equities research, macro research, strategy and index research to offer fair, unbiased, comprehensive analysis that helps guide EFG Hermes’ other departments and the Firm’s large client base when making critical financial decisions. Leveraging a team of experienced analysts and an on-the-ground presence in numerous markets around the world including Cairo, Dubai, Pakistan, Kenya, the UK and Singapore, the division provides unmatched insight on 287 equities across 26 markets as of year-end 2019. In 2018, EFG Hermes’ Research division launched Egypt One, an innovative, retail-oriented platform that has quickly become the go-to information provider for analysts and clients looking for reliable daily insights on local and regional markets.

The Non-Bank Financial Institution

Tanmeyah

EFG Hermes Finance acquired Tanmeyah Microenterprise Services in 2016 and it has since become the Firm’s flagship company under its NBFI platform. Tanmeyah, which today stands as the number one non-bank provider of microfinance solutions in Egypt, provides financing for micro and very small business across Egypt giving its thousands of clients access to the necessary capital to find a path out of poverty and grow their businesses. The company also offers products and services that complement the diverse needs of small businesses, such as microinsurance and group lending. As of year-end 2019, Tanmeyah had 268 operational branches catering to the needs of over 360,000 borrowers in 24 of the 27 Egyptian governorates.

EFG Hermes Leasing

EFG Hermes Leasing was launched in 2015 and today is a leading provider of leasing solutions and value-added advisory services in Egypt. EFG Hermes Leasing leverages its extensive multi-disciplinary expertise to offer high-quality, tailored solutions at competitive prices, with the fastest turnaround time in the industry, to a growing pool of clients ranging from large corporations to SMEs.

EFG Hermes Factoring

Launched in early 2018 to further diversify the Firm’s NBFI offering, EFG Hermes Factoring provides businesses with an alternative source of financing, allowing them to meet their more pressing working capital needs and obtain the liquidity they need to grow their businesses. EFG Hermes Factoring is currently one of the few active players in the Egyptian factoring space, with its market share at the end of 2019 standing at 10%.

Mortgage

In the second quarter of 2019, Bedaya Mortgage was launched in partnership with Talaat Mostafa Group (TMG) and GB Capital, the NBFI Platform of GB Auto. This joint venture was the natural evolutionary step to expand our NBFI platform.

Insurance

In late 2019, EFG Hermes (through EFG Hermes Finance) and GB Auto (through GB Capital) announced their entry into a definitive sale and purchase agreement to acquire a 75% stake in life insurance player Tokio Marine Egypt Family Takaful in a deal worth EGP 84.75 million. Under the agreement, which is subject to regulatory approval, EFG Hermes Finance and GB Capital will each own 37.5% of the company.

valU

valU, which was launched in 2017, is EFG Hermes’ first fintech product and is part of a wider diversification strategy by the Firm as it looks to tap into new, growing segments of the financial sector. The innovative solution gives customers the ability to use their smartphones to complete purchases from 485 merchants across Egypt and allowing them to pay in convenient installments over 3-24 months. valU has quickly grown in popularity with over 58,000 active users as of year-end 2019. As a testament to valU’s success thus far, the app was recognized as the “Fintech Innovation of the Year” at the prestigious 2019 Seamless Awards in Dubai as well as the E-Commerce Summit Award for the Top Payment Solution in Egypt.