Export Development Bank of Egypt Broadens its Horizons

  • 18th, April, 2018
Export Development Bank of Egypt Broadens its Horizons

 An Interview with Mervat Soltan, Chairperson of Export Development Bank of Egypt

The Export Development Bank of Egypt (EBE) was established in 1983 to be specialized institution helping to boost Egypt’s exports.  It was successful but, in the view of many, never achieved its full potential.

Now, the bank is charting a more ambitious course, staying true to its original mission to support Egypt’s exports while spreading its wings much wider and planning significant balance sheet growth. This new strategy is being led by Mervat Soltan, an experienced banker who took over the Chairpersonship of the bank in November 2016.

The Arab Bankers Association’s Editor, Andrew Cunningham, spoke to Ms Soltan about the changes she has introduced at the bank already, and those that she has planned for the future.

ARAB BANKERS ASSOCIATION: How is Export Development Bank of Egypt changing?

MERVAT SOLTAN: We are a little over one year into a five year strategy that is centered on six key objectives. Two of these objectives relate to what we do as a bank: we want to increase Egypt’s exports and promote local employment. Three relate to how we do our work: we want to strengthen our use of technology as a way of enhancing our competitive position, invest in and develop our human capital, and change our internal culture so that we encourage creativity and innovation to deliver excellence. The final objective refers to our broader position in society: we recognise our social responsibilities and want to act upon them.

Can you be more specific about your role in increasing Egypt’s exports?

We are focusing on Africa, starting with East African countries, to capitalise on the COMESA agreement, in line with the Business Development Strategy that was published by the Minister of Trade at the end of 2016. Our international business group is making a lot of visits to Africa and we are also working closely with Afreximbank, which has its headquarters in Cairo and has offices in 45 African countries. 

We have been increasing the number of correspondent banking relationships that we have with African banks. This is an important point – we hear a lot these days about how the big western banks are cutting their lines to emerging market banks, including those in Africa. Well, we are increasing our correspondent banking network in Africa, which is not only good business for us, but is also very helpful for those African banks. 

We are also trying to expand Egyptian exports throughout the Middle East, but that is something that the bank has always done, whereas Africa is a continent in which we know we can do more. 

What type of services do you offer to Egypt’s exporters?

We offer the basic services that you would expect, such as letters of credit, export finance, and funding in its different forms and tenors. 

But we are also preparing to offer advisory services and research. Basically, we are establishing a new International Banking Group that will focus on export promotion and support. The new teams will work closely with every existing or potential exporter to help them grow their exports through expansion or penetration of new markets. Moreover, we would help structure their trade and facilities required to cope with their projected growth.

Do you focus on the big Egyptian exporters or are you also interested in helping small and medium sized enterprises (SMEs)?

SMEs are very important to us. They account for a significant proportion of Egyptian GDP and employment, and of course many of today’s big exporters started out as SMEs. We very much want to help SMEs expand by becoming exporters. We have taken advantage of the initiatives taken by the Central Bank of Egypt to promote SME lending, and during our last financial year (to the end of June 2017) our SME lending portfolio more than doubled. It is now about one fifth of our total lending. 

How does the promotion of local Egyptian employment fit into this strategy?

Egypt has a large, young and skilled labor force. Therefore, opening new opportunities for Egyptian companies of different sizes automatically implies more job opportunities. Also, we encourage labor intensive sectors like textiles as it helps bring down the unemployment rates.

You have said that EBE will expand its retail banking business. Why is an export development bank creating a retail banking business?

First of all, let me be clear that our primary mission is, and will remain, to support Egypt’s exports and trade. However, many of our clients have large numbers of employees who need banking services, and we believe that we can serve those clients better if we provide a more comprehensive banking services than in the past. We will continue taking deposits, and we will offer different savings and investment products, credit cards and consumer loans, and we will also help our clients to manage their payroll.

We currently have 31 branches in Egypt and we plan to increase our branches by 30% a year each year during our five year plan to 2022. 

There is another reason why we would like to develop retail business: we are heavily dependent on corporate funding. If we can expand our retail deposits, we will be able to reduce our overall cost of funding, and we will be able to pass the benefit of that on to our customers, and also to our shareholders. 

It is important to note that our retail strategy will not only target deposits. We are developing new products for small and very small enterprises to help develop these sectors. This is an important part of fulfilling our social mission as an Egyptian bank, alongside our specific mission to support exports. 

Are you increasing your staffing in line with your wider ambitions?

Yes, since I arrived at the end of 2016, I made some important new appointments: we have a new Chief Risk Officer, and new heads of Consumer Banking, Product Development, Retail Risk, and International Banking, and we have about 100 new graduates to help us grow all businesses.

One of your strategic objectives is to change the culture of the bank. What does that mean? 

The bank has tremendous potential and many experienced colleagues. However, in the past there was no real empowerment of staff that would enable them to grow and expand the business. So, we are creating a culture of empowerment, creativity and innovation to generate a flow of new ideas and products so that we can deliver excellence in everything we do.

Who are your shareholders and what are their objectives?

Our biggest shareholder is the National Investment Bank with 40.75%. Banque Misr has 23.13%, and National Bank of Egypt has 11.57%. That leaves 24.55% which is traded on the Egyptian stock exchange. Historically, it has been normal for the big banks to take stakes in strategic financial institutions such as EBE. We have seen a trend for banks to divest those stakes in recent years, but as we expand and develop our business the value of those stakes increases, and our major shareholders are under no pressure to divest. 


Mervat Soltan became Chairperson of Export Development Bank of Egypt in November 2016. She had previously worked as General Manager, Financial Institutions, at Ahli United Bank in Cairo, and before that spent five years with HSBC in Dubai as Director of Financial Institutions in North Africa and the Levant. Earlier appointments were with Abu Dhabi Islamic Bank and with Deutsche Bank. She holds a BA in Business Administration and an MBA from the American University in Cairo. 

EBE had unconsolidated assets of LE32,972mn ($1,823mn) at the end of June 2017. It had total loans of LE15,457mn and customers’ deposits of LE27,512mn. Shareholders’ equity was LE1,440mn. Net profit was LE 502mn.