Egypt’s Housing Bank boosts its investments into subsidiaries, sister companies in 9M-22

The Housing and Development Bank, leading state-owned lender, has been seen increasing its investments in subsidiaries and sister companies by 9.96% at the end of last September.

It rose to EGP 2.137 billion pounds in 9M-22 compared to EGP 1.944 billion pounds at the end of 2021 with an increase of 193.600 million pounds.

It is worth mentioning that, affiliated companies are companies that are related through ownership, either with one owning the other as a minority shareholder or with multiple companies being owned by a third party. An affiliated company differs from a subsidiary through the size of the ownership.

A subsidiary is a company where 50% or more of the company is owned by another. A key characteristic of an affiliated company is that less than 50% of the company is owned by an individual shareholder. Any parent company of the affiliated company is considered a minority shareholder.

However, sister companies are subsidiaries that are related to one another by virtue of the fact that they share a common parent entity. Each sister company operates independently from the others, and in most cases, they produce unrelated product line

The HDB owns about 10 subsidiaries in various fields that act as effective investment arms for the bank. The bank has subsidiaries in different fields such as the real estate development, mortgage marketing and technology. The bank’s direct contribution to subsidiaries varied between 92% and 15.7% with values ranging between EGP533 million and 942.000 according to latest separate financial statements published on the bank’s page.

Furthermore, HDB has 7 sister companies, with direct shareholding rates ranging between 36.9% and 10.8%. HDB owns more than half shares in Hyde Park Real Estate Development Company with a contribution rate of 53.66% and a value of EGP1.61 billion at the end of last June. However, the bank’s contribution into the Development Company for Housing and Utilities is about 35%, with a value of EGP 43.13 million

In addition, the bank’s shares in Mortgage Finance Company amounted to 24.84%, with a contribution value of 235.38 million pounds.

However, the bank has reduced its shares into City Edge Real Estate Development Company to record 25.76% at the end of last June, instead of 35.05% at the end of 2021. Moreover, the bank’s profits from sister companies amounted to EGP162.96 million in June 2022.

Recently, HDB has launched its latest subsidiary Housing and Development Properties (HDP) for real estate marketing. HDP provides professional real estate marketing and investment services. It aims to be one of the largest real estate marketing companies in Egypt and the Middle East region.

The company has an ambitious expansion strategy to provide customers with integrated marketing and investment services at the highest level which enables it to increase the market share and attract new customers in this field, as well as provide the opportunity for it to have a distinctive presence through marketing the current projects owned by the Bank.