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Banque Misr And Sarwa Capital Successfully Closed a Securitization Bond for Egypt’s New Urban Communities Authority (NUCA) of EGP 4 Billion with Substantial Investment from The European Bank for Reconstruction and Development (EBRD)
Banque Misr and Sarwa Capital Holding for Financial Investments SAE (SRWA.CA), announced today the conclusion of a securitization bond issue for Egypt's New Urban Communities Authority (NUCA). The issue size is EGP 4 billion and received a rating of AA- by Middle East Ratings and Investors Service (MERIS).
The success of this landmark transaction comes on the back of extensive engagements and consultations by the strategic alliance between Sarwa and Banque Misr with a number of international and local banks and institutions including the European Bank for Reconstruction and Development (EBRD), which is also a major participant in this bond issuance.
Sarwa Promotion & Underwriting, and Banque Misr acted as lead managers, arrangers, and co-underwriters on the transaction. The Arab Legal Advisors acted as Legal Advisor for the transaction. It is worth mentioning that Sarwa is the leading private issuer of bonds in the market, the first and largest issuer of securitization bonds and the first to issue bonds backed by real estate receivables. Together, Sarwa and Banque Misr have issued more than 35 bond issuances totaling over EGP22 billion in light of the fruitful cooperation between the two entities over the years.
Dr. Mazen Hassan, Vice President of the New Urban Communities Authority (NUCA): "We successfully closed this issuance of NUCA's securitization bond in which the net proceeds will be used to finance the development of new sustainable cities and other national projects to be delivered in a timely manner. And we would like to thank Banque Misr and Sarwa Capital for supporting the development efforts of the government and for concluding this issuance professionally building on their long-established record in securitization."
Mohamed Eletreby, Chairman of Banque Misr, commented: "The role of capital markets in bridging the financing needs for investments opportunities is currently growing in the Egyptian market, as it complements bank financing, and therefore supports the growth of the Egyptian economy. We're delighted with such development, and in particular with the active participation of Banque Misr in fostering the debt capital market in Egypt, through the promotion and underwriting of the various issuances."
Dr. Suzan Hamdy, Head of Capital Markets Group at Banque Misr, commented: "Tapping into the debt capital market as an alternative source of funding in the Egyptian market by NUCA represents a key milestone for the fixed income market, as it can be a strong spur to introducing new instruments in the market for both domestic and foreign institutions. Additionally, this is becoming a significant market to the authority to
finance the development of the Egyptian real estate market in a way that will support the growth of the national economy. We are thrilled to be part of this success by promoting and co-underwriting this issuance, and also by acting as a custodian."
Ayman Elsawy, Chairman of Sarwa Promotion & Underwriting, commented: "It is indeed a pleasure to participate in structuring and promoting this issuance of NUCA's securitization bond, and be part of their success tapping into debt capital markets as an alternative way of financing urban infrastructure of its sustainable cities.
We see this issuance as a positive start towards diversifying their funding base and attracting foreign investments to the country. Moreover, it reflects the rising investor confidence in the Egyptian government and its plans towards sustainable economic growth, in addition to the development of the fixed income market in Egypt."
Sir Suma Chakrabarti, EBRD President said: "We are glad to support the deepening of the local-currency debt capital markets in Egypt and believe that this participation will have a strong demonstration effect on other international and local investors. We are also pleased that this issuance will help NUCA allocate resources for its investments in developing new sustainable towns on desert land, this will help stimulate the economy and create new job opportunities"
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