Egypt - EFG Hermes, the leading investment bank franchise in Frontier Emerging Markets (FEM), has announced that its Investment Banking division closed the first issuance worth EGP651.2 million ($34.75 million) of the EGP3 billion ($160.09 million) securitization programme for Bedaya Mortgage Finance, Egypt’s first non-bank online mortgage provider.

The bond is mortgage backed portfolio of around EGP1.02 billion, assigned to EFG Hermes, the issuance’s special purpose vehicle (SPV). This transaction marks the first ever securitization for a real estate mortgage company in Egypt, said a statement.

The bond is comprised of eight tranches with both fixed and variable yields, with the structure as follows: a first tranche of EGP22.22 million with a 13-month bond tenor and a variable yield; a second tranche of EGP22.22 million, with a 24-month tenor and a variable yield; a third tranche of EGP88.9 million, with a 36-month bond tenor and a variable yield; a fourth tranche of EGP226.69 million, with a 84-month tenor and a variable yield; a fifth tranche of EGP84.45 million, with a 115-month bond tenor and a variable yield; a sixth tranche of EGP20.67 million, with a 12-month tenor and a fixed yield; a seventh tranche of EGP102.32 million, with a 36-month tenor and a fixed yield; and an eighth tranche of EGP83.71 million, with an 84-month tenor and a fixed yield.

Maie Hamdy, Managing Director - Debt Capital Markets at EFG Hermes, said: “We are proud to have advised on the first real estate mortgage securitization transaction in the Egyptian market, which has been met with extensive interest from investors, bearing in mind the almost 10-year tenor notwithstanding the current market uncertainty. Taking this step with Bedaya – a joint venture between EFG Hermes Holding, Talaat Mostafa Group, and GB Capital – comes as part of our broader strategy to capitalize on our cross-selling synergies and product diversification that are an essential pillar of our business model and progression. We are very proud of the success of this issuance and attribute it to our team’s unwavering commitment to consistent value creation and forward-looking approach.”

Tarek Abou-Gendia, CEO and Managing Director of Bedaya, said: “As a company, we pride ourselves on the sort of consistent innovation that can propel our industry forward, which is why we are very excited to become the first real estate mortgage company in the country to issue a securitization issuance. This transaction will capitalize on the capabilities and cross-selling power of EFG Hermes to move us closer to our long-term expansion plans through broader, more sustainable financial solutions so that we can continue on our mission to extend accessibility to a wider customer base across Egypt’s mortgage market.”

EFG Hermes acted as the sole financial advisor, sole transaction manager, book-runner, underwriter, and arranger on the issuance. National Bank of Egypt (NBE), alongside Banque du Caire (BDC), acted as underwriters and Baraka Bank acted as the subscription bank. The legal advisor for the issuance was Dreny and Partners and the auditor was KPMG. Middle East Ratings and Investor Services (MERIS) acted as the credit rating agency. 

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