الهيئة العامة للرقابة المالية

• The meeting featured specialized sessions and workshops on listing , offering , real estate funds, bonds, sukuk and sustainable practices in the real estate sector

Dr. Mohamed Farid , FRA Chairman:

• The non-bank financial sector provides a wide range of innovative financing solutions to cater to the needs of all economic sectors.
• The meeting is a platform to discuss the process of listing shares, offering, bonds, and sukuk on the stock exchange, as well as exploring their potential as financing mechanisms.
• FRA will continue its ongoing dialogue with all market participants to further develop the market and create more opportunities for growth and innovation.
• Listing shares on the stock exchange facilitates sustainable business development with a focus on governance and environmental aspects

Real Estate Developers:

• Non-bank financing offers a powerful tool for real estate companies. Continued collaboration with the Authority is key to realizing the full potential of these solutions
• FRA’s initiative unlocks new avenues for growth and development in the real estate sector through non-traditional financing

Dr. Mohamed Farid, FRA Chairman met with numerous real estate developers on Monday at a conference titled “The Non-Bank Financial Sector: Financing Horizons for Real Estate Development.” Dr. Farid emphasized the significance of supporting the real estate sector by exploring innovative financing avenues offered by the non-bank financial sector.

Khaled Shita, Conference General Manager, Engineer Ahmed Sabbour, Chairman and Managing Director of Al Ahly Sabbour Developments and Engineer Khaled Abbas, Chairman of the Board of Directors of the Administrative Capita for Urban Development (ACUD) attended the opening session.

Dr. Farid dedicated the meeting to a comprehensive overview of the diverse financial solutions and services offered by the non-bank financial sector under FRA’s supervision. He delved into the process of listing on the stock exchange, highlighting the numerous opportunities it presents for companies to achieve their goals. In this context, he emphasized the potential of securitization bonds and sukuk as financing mechanisms available on the capital market for even non-listed companies.

Additionally, Dr. Farid discussed the recently developed Accounting Standards that empower companies to re-evaluate their assets at market value. He also explored the benefits of real estate funds and the significance of sustainability standards in developing and building sustainable residential communities.

FRA’s Chairman indicated that the Authority would continue its dialogue with all market participants, aiming to develop the market, provide opportunities for companies, explain reforms and opportunities and seek to establish a common dialogue between the public and private sectors. He highlighted the importance of the dialogues undertaken by the Authority, emphasizing that addressing the detailed inquiries of the attendees would not have been possible without these discussions. Furthermore, he noted that this conference is a direct outcome of these dialogues.

Dr. Farid announced that 36 real estate companies are currently listed on the Egyptian Exchange. Collectively, these companies have a market capitalization of EGP 263 billion and they have demonstrated strong financial performance with a 19.7% return on equity and a 39.2% net profit margin.  He pointed out that listing at the Exchange empowers these companies by providing capital, improving governance and benefiting shareholders.

FRA’s Chairman indicated that the combined equity value of five companies, each with a pre-IPO market capitalization exceeding EGP 500 million, experienced a significant 10.3-fold increase, rising from EGP 19.1 billion to EGP 193.3 billion following their initial public offerings. The market capitalization of four mid-sized companies experienced a dramatic 103-fold increase, rising from EGP 140.5 million to EGP 14.5 billion following their listing on the stock exchange; this demonstrates the significance of listing on stock exchanges. Additionally, he emphasized the importance of securitized bonds as a flexible and efficient financing tool that enables real estate companies and others to achieve their strategic objectives.

Also, he stressed the critical role of technological innovation in unlocking the potential of the non-bank financial sector. By leveraging technology, the sector can provide a wider range of financial services to a broader population, enhancing financial inclusion and empowering individuals. This will also benefit real estate funds. Additionally, he explained that the insurance sector plays a crucial role in the real estate market by offering title insurance, which safeguards property buyers’ rights and thereby encourages investment from both domestic and international buyers. He noted that there are companies with the capacity and willingness to assume this risk and reinsure policies, enabling them to issue standard policies electronically.