BM Consumer Finance – Souhoola has completed its third securitization bond issuance, raising EGP 883 million (about US$16.9 million) to strengthen its funding base and support the growth of its consumer financing portfolio.
The issuance is backed by an assigned portfolio worth EGP 1.05 billion (about US$20.1 million). It forms part of Souhoola’s strategy to diversify its funding sources and increase its capacity to provide financing to its growing customer base.
The transaction consists of two tranches. The first is valued at EGP 700 million (about US$13.4 million) with a 12-month maturity, while the second is valued at EGP 183 million (about US$3.5 million) with a 22-month maturity.
The first tranche received a Prime 1 rating from MERIS – Middle East Rating and Investors Service, the highest credit rating, while the second tranche received an A- rating.
Supporting Expansion and Customer Financing
Ahmed El-Shanawany, CEO of BM Consumer Finance – Souhoola, described the transaction as an important step in the company’s development.
“The completion of our third issuance marks an important milestone in Souhoola’s growth journey and reflects our ability to leverage different financing instruments to support our expansion plans and strengthen our capacity to meet our customers’ needs,” El-Shanawany said.
He added that the higher value of the latest issuance reflects the continued growth of the company’s portfolio.
“The notable increase in the issuance value compared to the previous issuance reflects the continued growth in the size and quality of our portfolio and demonstrates our success in building a strong and sustainable funding base aligned with our direction and plans for the coming period,” he said.
El-Shanawany said Souhoola will continue to focus on expanding its customer base while providing financing solutions that support financial inclusion.
“At Souhoola, we remain focused on expanding our customer base and growing our financing portfolio, while prioritizing more flexible and efficient solutions that support our efforts to advance financial inclusion and contribute to the growth of Egypt’s consumer finance sector,” he said.
Fady Elias, Chief Financial Officer of Souhoola, said the transaction also reflects progress in the company’s funding strategy.
“We view diversifying our funding sources as a key element of our growth strategy, as it provides greater capacity to continue expanding while maintaining a balanced funding structure that supports our long-term objectives,” Elias said.
Expanding Access to Debt Capital Markets
Elias also pointed to the ratings received by the two tranches.
“The strong credit ratings assigned to the issuance tranches also reflect the quality of the portfolio and the level of confidence in Souhoola’s business model,” he said.
Ahmed Haidar, CEO of Al Ahly Pharos for Investment Banking, said the transaction would provide Souhoola with additional liquidity for expansion.
“We are pleased to have successfully completed this issuance for Souhoola, providing the company with the liquidity needed to grow its financing portfolio and expand its customer base,” Haidar said.
Ahmed Ayman, Head of Debt Capital Markets at Al Ahly Pharos, highlighted the wider role of securitization in the consumer finance market.
“This issuance underscores the role of securitization as an effective instrument that enables consumer finance companies to convert their portfolios into liquidity, supporting the provision of new financing and continued growth,” Ayman said.
Amr Helal, CEO of Investment Banking (Sell-Side) at CI Capital, and Mohamed Abbas, Managing Director and Head of Debt Capital Markets at CI Capital, also welcomed the completion of the transaction and highlighted the work of the teams involved.
CI Capital and Al Ahly Pharos acted as financial advisors, arrangers, coordinators, issuance managers and bookrunners. Baker Tilly served as financial auditor, while Matouk Bassiouny & Hennawy acted as legal advisor.
