Egypt Macro | Positive view intact as growth, fiscal consolidation continue
EGP appreciation likely as NFAs turn positive. An undervalued EGP is prompting a strong recovery in FX liquidity; Customer USD sales drove inflows of USD30bn into the banking system since Nov-16. We view the NIR build-up rising 77% y-o-y to USD31bn in May (6.5 months of import coverage) vs. 8.6 in FY09/10), and more importantly, the CBE’s NFAs turning positive for the first time in 18 months (to USD0.3bn in Mar-17), as strong signs that the currency crunch is dissipating, although we revise our average USD:EGP rate forecast for FY17/18 to 16.8 from 15 (vs. spot of 18.15), as we foresee a delay in appreciation until NFAs at local banks also turn positive, likely in 3Q17. Otherwise, we expect strong BoP dynamics will offset USD10bn in foreign liabilities in FY17/18.
CI Capital is a diversified financial services group and Egypt’s leading provider of leasing, microfinance, and investment banking products and services.
Through its headquarters in Cairo and presence in New York and Dubai, CI Capital offers a wide range of financial solutions to a diversified client base that include global and regional institutions and family offices, large corporates, SMEs, and high net worth and individual investors.
CI Capital leverages its full-fledged investment banking platform to provide market leading capital raising and M&A advisory, asset management, securities brokerage, custody and research. Through its subsidiary Corplease, CI Capital offers comprehensive leasing solutions, including finance and operating leases, and sale and leaseback, serving a wide range of corporate clients and SMEs. In addition, CI Capital offers microfinance lending through Egypt’s first licensed MFI, Reefy.
The Group has over 1,700 employees, led by a team of professionals who are among the most experienced in the industry, with complementary backgrounds and skill sets and a deep understanding of local market dynamics.
CI Capital has been recognized as the “Best Investment Bank in Egypt” by EMEA Finance for four years running from 2013-2016, and by Global Finance in 2014 and 2015.
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