Suez Canal Bank (SCB)’s two major shareholders are studying to offer an immediate funding package to comply with the requirements of the Central Bank of Egypt (CBE) as regards to settling SCB’s bad debts. The anticipated immediate funding package shall be in form of an assistant loan to the bank or via increasing its capital.
Suez Canal Bank (SCB)’s two major shareholders; the Arab International Bank and the Libyan Foreign Bank (LFB) are studying to offer an immediate funding package to comply with the requirements of the Central Bank of Egypt (CBE) as regards to settling SCB’s bad debts, the General Manager of LFB told Amwal Al Ghad on Wednesay.
The General Manager of the Libyan Foreign Bank (LFB) Mr. Mohamed Ben Yousef said the Arab International Bank has 41.48% stake in Suez Canal Bank, whereas the LFB’s contribution in the SCB is accounted for 27.71%.
The anticipated immediate funding package shall be in form of providing an assistant loan to the bank or via increasing its capital.
Ben Yousef has referred that the SCB’s board of directors has recently convened to review the bank’s position and discussed the mechanisms to face its bad loans to comply with the CBE’s requirements.
He added that the board of directors (BOD) has agreed on preparing a rescue plan which includes the completion of the SCB’s financial and administrative restructuring processes, aiming to meet with the international standards as well as the CBE’s regulations.
The SCB’s board is currently working on an expansion plan designed for the SMEs, Ben Yousef noted. As pursuant to the expansion plan, SCB is also targeting making a strong presence in the retail banking sector of which the hopes are high to achieve high growth rates and significant profitability, he added.
“Carrying out Suez Canal Bank’s expansion strategy is to unlock the shareholders’ rescue package.” Ben Yousef elaborated
Moreover, he stated that the BOD is set to unveil the SCB’s retail banking sector program as well as to organize training courses for the employees working in the retail banking division in order to keep up with the bank’s anticipated launch.
In accordance with the Suez Canal Bank’s expansion scheme, the bank is aiming to increase volume of profits to exceed EGP 600 million within the upcoming 3 years, Ben Yousef further explained.
The LFB general manager has asserted that Suez Canal Bank enjoys growth potentials necessary to achieve high returns, including the finest technology structure in the world alongside the best banking cadres, a well-spread branch network, outstanding credit card services and soon the E-banking program.
Ben Yousef also revealed that Dr. Hisham Ramez – the former Chairman and Managing Director of Suez Canal Bank – was the one who initiated the actual reform plan for the SCB, and accordingly he would not bear the inherited problems suffered by the bank. The SCB is facing inherited problems that can be represented in having a huge portfolio of bad debts resulted from ill-considered credit operations.
He added that the current administration of the SCB is going on its reform plan which is expected to post profitability up to EGP 150 million by the end of 2013 along with profits exceeding EGP 600 million within the coming three years.
