Beltone Financial to launch $1B fixed income fund

CAIRO - 14 August 2017: Egyptian financial services group Beltone Financial will launch a $1 billion investment fund in fixed income instruments in September, its chief executive officer told Reuters on Monday.

The investment bank aims to raise $150 million to $200 million in the fund's first phase, Bassem Azzab said in a telephone interview. The fund will seek to attract Gulf and European investors as well as those in the United States.

Appetite for Egypt's domestic debt has increased since November when the central bank floated the pound currency as part of a $12 billionInternational Monetary Fund programme aimed at boosting the economy. The central bank has raised interest rates by 700 basis points since the float.

Total foreign holdings in Egypt's debt instruments have as of August 8 reached $15.25 billion, according to the finance ministry.

Azzab also said Beltone, Egypt's largest asset manager, aims to acquire brokerages in Egypt and frontier markets.

"We aim to become the number 1 or number 2 in the Egyptian brokerage sector during 2018," he said.

He expects the company to manage the initial public offering of a pharmaceutical company worth over 1 billion Egyptian pounds ($56.37 million) on the Egyptian stock market before the end of 2017.

Beltone on Sunday reported a second-quarter net profit of 1.36 million Egyptian pounds, a turnaround from its 9.1 million pound loss in the same period last year.

The company has more than 25 billion Egyptian pounds in assets under management and aims to double that figure in around six months to one year, Azzab said.

Beltone was acquired by billionaire businessman Naguib Sawiris'sOrascom Telecom Media and Technology in 2015.

The investment bank aims to expand in frontier markets through its New York-based Auerbach Grayson & Company, which it acquired 60 percent of last year.