EFG-Hermes to get Nigerian investment banking license

Egyptian financial services giant, EFG-Hermes anticipates getting an investment-banking license in Nigeria next week, as part of its plans in expanding its capital market business across frontier markets, Ali Khalpey, the chief executive officer of the company’s frontier unit, said in Dubai

“We have got all the boxes ticked, and we are just waiting for regulatory approval, we should receive the authorization if not this week, early next week.” Khalpey said, noting that the firm plans on hiring five people in Lagos this year.

In July this year, EFG-Hermes bought Primera Africa, its second foray into sub-Saharan Africa after obtaining a Kenyan stockbroking license in July 2017 that enables it to extend its operations to Tanzania, Uganda and Rwanda. The firm however did not disclose how much it was paying for the 100 percent stake in Lagos-based Primera Africa

The company’s investment-banking advisory business is targeting multinationals and big local companies as customers, according to Khalpey.

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The lender aims to complete the acquisition of Primera Africa – announced in July – “in the next 10 days”, as it deepens its presence in Nigeria, as it plans to use Africa’s most populous nation as its regional hub.

The announcement comes five days after the Central Bank of Nigeria (CBN) released its half year economic reports citing the closure of two global banks (HSBC and UBS) local offices in Nigeria, for reasons not disclosed.

The apex bank also said foreign direct investment in Nigeria fell to 379.84 billion naira ($1.2 billion) in the first half of the year from 532.63 billion naira ($1.7 billion) a year earlier.

The brokerage and research house, which services local and foreign investors, will be rebranded as EFG-Hermes Nigeria, Mr Khalpey added.

While the firm’s attention in 2019 will be on consolidation in recently entered markets, including those in Africa, Pakistan and Bangladesh, Khalpey says it sees opportunity to expand in Vietnam.

The Asian country “is definitely a market we would like to have some exposure to,” he said.

Khalpey was hired in January 2017 to build EFG-Hermes’ frontier-markets business.

EFG-Hermes announced its intention to expand its frontier markets unit last January, when Mr Khalpey was appointed chief executive. The division, which has a particular focus on securities brokerage, investment banking and research, has since progressed its expansion strategy in five markets.

These are: the UK, where it is now fully licensed to service a broad spectrum of frontier markets; Kenya, where it has a greenfield presence; Nigeria; Pakistan; and Bangladesh, where it opened a representative office in January.

MICHEAL ANI