EFG Hermes Holding, Egypt’s biggest investment bank, will acquire 51 percent of state-owned Arab Investment Bank (AIB), the cabinet said in a statement on Wednesday, in the first bank privatization in more than a decade.
Under the transaction, the Sovereign Fund of Egypt will also acquire a 25 percent stake in AIB, while the current owner, state-owned National Investment Bank, will retain 24 percent, the cabinet said after approving the acquisition.
AIB’s capital will be increased to five billion Egyptian pounds ($319.90 million), it added.
The government began a program of selling its stakes in banks in 2004, and in 2006 sold most of its fourth largest bank, Bank of Alexandria, to the Italian bank Sanpaolo IMI, now owned by Banca Intesa.
The central bank says it plans to sell stakes in several banks it owns, including Banque du Caire, Egypt’s third-largest state-owned bank, but plans were put on hold because of the COVID-19 pandemic.