Cairo – Mubasher: MubasherTrade Research has upgraded their risk ratings of Export Development Bank of Egypt (EBE) from Sell/High Risk to Buy/Moderate Risk, according to a recent report.

The research firm has also raised its 12-month price target (PT) of the stock to EGP 14.8 per share, implying an expected total return (ETR) of up to 28.1%.

The EBE has completed its five-year strategic plan, in order to double its loan book, bolster Egyptian exporters, increase lending to small- and medium-sized enterprises (SMEs), boost lending to the retail segment, and upgrade the bank's information systems infrastructure, the report highlighted.

“The bank targets to increase its lending through adding 23 new branches, increasing its network to 58 branches and ATM machines to 100,” MubasherTrade indicated.

Given that EBE signed an exclusive agreement, Export Credit Support Scheme, worth $500 million with the African Export-Import Bank (Afreximbank) and EBE's subsidiary Export Credit Guarantee Company of Egypt.

The agreement aims at expanding export and trade between Egypt and other African countries, which may encourage Egyptian exporters to draw on loans from EBE to complete their business dealings with African countries, the report added.

Accordingly, MubasherTrade forecast that this deal will protect Egyptian investors in African countries from sovereign, currency exchange, and nationalization risks, in addition to raising EBE's lending activity which would reflect positively on the bank's profits over the coming period.