The Arab Republic of Egypt's Debut US$ 2 Billion Conventional and Islamic Syndicated Term Facility
Deal successfully closed by Emirates NBD Capital and First Abu Dhabi Bank PJSC
Dubai, 1 September, 2020: The Arab Republic of Egypt (“Egypt”), one of the largest and most diversified emerging markets in the MENA region, acting through the Ministry of Finance (“MoF Egypt” or the “Borrower”), has successfully signed its debut global syndicated conventional and Islamic financing facility on 20 July 2020 (the “Facility”) and completed the Egyptian Parliament approval during its session held on 18 August 2020.
The Facility aims to diversify Egypt’s sources of funding and its access to international capital market instruments. The proceeds of the Facility would primarily be utilised to finance the country’s budgetary requirements, and support the country in safeguarding its strong economic trajectory over the past years and sustaining its strong footing to weather the prevailing volatility in the global markets.
Emirates NBD Capital Limited, the investment banking arm of Emirates NBD and First Abu Dhabi Bank PJSC (“FAB”) acted as the Joint Global Coordinators and Initial Mandated Lead Arrangers and Bookrunners (“IMLABs”) on the Facility. In addition, Emirates NBD Capital acted as the Documentation Bank, and FAB as the Global Agent, Facility Agent and Investment Agent.
The Facility was anchored by the IMLABs and was launched to a select group of Islamic and Conventional investors in general syndication. Amidst a challenging market backdrop due to the on-going COVID-19 crisis, the transaction received an overwhelming response from the market with a 1.75x oversubscription. The Borrower chose to exercise the green-shoe option to upsize the Facility to US$ 2 billion from the size at launch of US$ 1.5 billion. The success of this transaction reiterates the strong regional and international investor confidence in the Egyptian economy, and its progressive credit story.
The Facility was closed with participation from a diversified mix of regional and international lenders, joining the Facility as:
Mandated Lead Arrangers and Bookrunners:
- Mashreqbank psc, ABC Islamic Bank (E.C.), Arab Banking Corporation (B.S.C.), HSBC Bank Middle East Limited, Standard Chartered Bank, Sumitomo Mitsui Banking Corporation.
Mandated Lead Arrangers:
- Gulf International Bank B.S.C., Abu Dhabi Islamic Bank PJSC, Al Ahli Bank of Kuwait KSCP – DIFC Branch, Dubai Islamic Bank PJSC, Intesa Sanpaolo S.p.A., Samba Financial Group, Sharjah Islamic Bank PJSC.
- Citibank, N.A., London Branch, Emirates Islamic.
Mohamed Maait, Minister of Finance, Arab Republic of Egypt, commented: “We are proud of the appetite and interest received from regional and international banks in the syndication. It is a signal of Egypt’s successful reform program. Amidst challenging conditions, Egypt is reaping the fruit of consistent efforts towards enhancing its economy’s resilience. Egypt is continuously diversifying its funding sources by tapping regional as well as Islamic sources of finance. Emirates NBD Capital and FAB, in their capacity as Joint Global Coordinators and IMLABs, demonstrated strong competence towards successful closure of the transaction.”
Fahad Abdulqader Al Qassim, Chief Executive Officer, Emirates NBD Capital commented: “The success of the debut syndicated loan market issuance reaffirms Egypt’s favourable position in emerging markets and the growing cross-border investor confidence in the country. Emirates NBD Capital is pleased to coordinate and lead the transaction and we look forward to playing an instrumental role in the country’s future funding requirements. The deal reiterates Emirates NBD’s commitment to its global strategic clients amidst a rapidly changing market landscape and our ability to provide optimal funding solutions in both Islamic and conventional formats.”
Andy Cairns, Senior Managing Director & Head of Global Corporate Finance, First Abu Dhabi Bank, commented: ”FAB is honoured to lead this debut syndicated loan facility for Egypt Ministry of Finance. That the transaction was oversubscribed evidences the high standing the Egypt sovereign is held by international and regional lenders as well as being testament to the country’s sound economic health.”