Overview

EFG Hermes Leasing is one of the market’s leading providers of leasing solutions and value-added advisory services, a position the company has held since inception in 2015. EFG Hermes Leasing serves a growing pool of clients ranging from large corporations to SMEs and leverages the team’s extensive multi-disciplinary expertise to offer high-quality, tailored solutions at competitive prices, with the fastest turnaround time in the industry, thus fending off rising competition in the sector.

Operational Highlights of 2019

During the past year, the company was confronted with challenges from multiple fronts including a shifting regulatory environment, increasing competition, and escalating price wars between the now 32 active players in the Egyptian leasing sector. Nonetheless, the solid fundamentals that have underpinned the business’s success from day one and dipping lending rates allowed EFG Hermes Leasing to once again come out on top, posting its best year thus far in terms of both financial and operational success.

Total net portfolio reached EGP 3.4 billion as at year-end 2019 and the number of clients served increased to 219 as of 31 December 2019 from 165 a year prior due to management’s efforts to consistently develop a diverse and individualized suite of products for customers and vendors alike. The business’ accelerated growth during the year, having hit a market share of 4.5% by the end of 2019 and a ninth-place ranking in the market.

During 2019, in line with the company’s strategy to grow and diversify its client portfolio, EFG Hermes Leasing saw its SME portfolio contribution to total business continue to expand, hitting 16% for the year compared to 15% in 2018 and 8% in 2017. At the same time, the company worked closely with its funders, which include 20 commercial banks and two international funds, to further increase and broaden its financing as it aims to extend low-cost credit to its SME clients. To this end, the company was able to secure an additional EGP 175 million in funding from the Saudi Development Fund (SDF), bringing the total granted facilities as of year-end 2019 to c. EGP 4 billion.

The team launched its securitization program in the fourth quarter of 2018, with the aim of positively impacting its leverage ratio and create room for further operational expansions. The addition of the new securitization program gives more weight, credibility and diversity to the company and its portfolio.

Its ever-expanding list of accomplishments garnered EFG Hermes Leasing a number of recognitions, including an award for the 2019 Fastest Growing Leasing Company in Egypt from International Finance Magazine and the best Securitization Transaction in Africa from EMEA Finance.

Key Financial Highlights of 2019

EFG Hermes Leasing’s contribution to total revenues for the year reached EGP 157 million in 2019 compared to EGP 168 million in 2018, down 6% Y-o-Y as the comparable year included a one-off securitization gain.