Magazine article Global Finance

Commercial International Bank Focuses on SMEs

Magazine article Global Finance

Commercial International Bank Focuses on SMEs

Article excerpt

Working with IFC to improve services and access to small businesses

In response to the growing contribution of small and medium-size Enterprises (SMEs) to the Egyptian economy, Commercial International Bank (CIB), Egypt's largest and most profitable private bank, is launching a new finance operation aimed at the SME sector.

CIB, Egypt's fifth-largest financial institution in terms of asset size, has identified significant business opportunities within the SME sector despite the inherent risk management challenges this sector represents.

Small and medium enterprises comprise much of the local economy and represent a vast and largely untapped market for financial institutions in Egypt and other developing countries. Although often plagued by weak financial reporting and other issues that cause leading local banks to perceive them as high-risk, many commercial banks around the world have managed to overcome these obstacles with proven models of profitable and effective small business lending.

In September 2003, the International Finance Corporation (IFC) signed a major advisory service mandate with CIB to assist it in developing retail and small and medium enterprise finance operations. The aim of the project is to help CIB develop and implement relevant organizational structures, information technology systems and products that will enable it to reach its objectives in terms of the growth and quality of its retail and small business operations over the next five years. …

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