Washington, D.C., June 9, 2003—The International
Finance Corporation, the private sector arm of the World Bank Group and
Citibank N.A. signed a US$60 million trade enhancement facility designed
to help private sector Egyptian importers with financing for the import
of capital goods and raw materials.
The four-year revolving facility will give private sector businesses in
Egypt better access to qualifying trade credit instruments originated by
selected commercial banks.
The facility will include five banks in Egypt—National Bank of Egypt,
Banque Misr, Egyptian American Bank, Export Development Bank of Egypt and
Misr International Bank. IFC will guarantee 50 percent of each transaction.
Karl Voltaire, IFC's Director for Global Financial Markets, said, "This
facility will enhance the availability of trade finance to Egyptian importers
by helping supplement country limits currently available to commercial
banks operating in Egypt. It will help maintain the level of trade
finance flows to the private sector in Egypt at a time when such finance
Sami Haddad, IFC's Director for the Middle East and North Africa, added:
"Given the various adverse external shocks, it is particularly important
to maintain trade flows since they contribute significantly to the level
of economic activity in Egypt. IFC is also considering participating in
other projects that will help strengthen Egypt’s economy and restore investor
Michel Accad, Citibank Region Head for North & West Africa, said, “This
new facility will allow us to multiply and enhance our correspondent banking
business in Egypt, making additional facilities available to Egyptian banks
who fit a strong risk profile. The trade enhancement facility is
the first such partnership between the IFC and Citibank, which we hope
to replicate in other countries in the area”.
Egypt is the Corporation’s twelfth largest exposure country. As
of end-January 2003, IFC’s exposure in Egypt was US$268 million for IFC’s
own account plus another US$335 million for the account of participants
in IFC’s B-loan program. As of March 25, 2003, IFC’s exposure to
Egypt’s financial sector in terms of disbursed and outstanding was US$33
This investment fits well within IFC's strategy and the overall World Bank
Group strategy for Egypt as it will help further develop the financial
sector, increase overall trade and support private sector businesses by
enabling local commercial banks to extend longer tenor trade credit.
Citigroup recorded net income of US$15.28 billion for the 12 months ended
December 31, 2002, an 8% increase over 2001. Core income for the
year was also a record, at $13.65 billion, or $2.63 per share. Citigroup
is assigned a “AA-” Senior Debt rating by Standard & Poors, “Aa1”
Senior Debt rating by Moodys and “AA+” by Fitch.
Citibank’s presence in Egypt dates back to 1955, when it opened the first
branch of a US commercial bank in the Middle East. In 1993, it gained a
license to operate in local currency thereby setting the stage for the
establishment of a full scale Global Corporate Investment Bank offering
banking products covering Corporate Finance, Treasury, Custody, Cash Management,
Trade and e-solutions to its corporate customers, as well as serving the
local bank and non-bank financial institutions.
IFC's mission is to promote sustainable private sector investment in developing
countries, helping to reduce poverty and improve people's lives. IFC finances
private sector investments in the developing world, mobilizes capital in
the international financial markets, and provides technical assistance
and advice to governments and businesses. Since its founding in 1956, IFC
has committed more than $34 billion of its own funds and arranged $21 billion
in syndications for 2,825 companies in 140 developing countries. IFC's
committed portfolio at the end of FY02 was $15.1 billion, with an additional
$6.5 billion held for participants in loan syndications. For more information
on IFC, please visit www.ifc.org.