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Frequently Asked Questions

EFG Hermes Asset Management is the fund manager for Credit Agricole I, Credit Agricole II equity funds and Credit Agricole III money market fund. With over 25 years of experience in the Egyptian market, the fund manager makes investment decisions on behalf of the investors based on through research and close monitoring of market conditions. EFG Hermes Asset Management is responsible for the performance of the funds under its management, as they handle the investment part of the fund.

Mutual funds and Certificates of Deposit (CDs) are two distinct investment options that differ in several key aspects, including structure, risk, returns, diversification and liquidity. below is a comparison:
  1. Investment Type
  • Mutual Funds: Mutual funds pool money from multiple investors to invest in a diversified portfolio of stocks, treasury bonds, or other securities. The value of your investment fluctuates based on the performance of the underlying assets.
  • CDs: A CD is a fixed-term deposit offered by banks and credit unions. You deposit money for a set period (e.g., 1 year, 3 years, etc.), and the bank pays you a fixed interest rate over that term. The principal is guaranteed, and the interest is usually fixed.
  1. Return and Risk
  • Mutual Funds: These carry market risk because the value of the underlying securities can rise and fall. As a result, returns are variable and depend on the performance of the assets within the fund. Equity mutual funds tend to have higher potential returns, but with greater risk, whereas bond funds offer more stable, albeit lower, returns.
  • CDs: Generally considered low risk because your principal and interest are guaranteed by the issuing bank. However, CDs face interest rate risk- if interest rates rise during the CD term, your fixed rate become less attractive. The return is fixed and predictable, but it is typically lower than the potential mutual fund earnings, especially in a low-interest-rate environment.
  1. Liquidity
  • Mutual Funds: Generally liquid, allowing investors to buy or sell shares daily. Some funds may offer weekly liquidity for entry and exit.
  • CDs: Funds are locked in until the maturity date. Early withdrawals may result in penalties, such as losing some of the accrued interest, and withdrawals are usually not allowed within the first six months.
  1. Diversification
  • Mutual Funds: Provide built-in diversification since the fund invests in a variety of securities, helping to spread risk across multiple assets.
  • CDs: offer no diversification, as the investment is concentrated in a single, fixed-income product.

Redemption orders can be signed at any of the bank’s branches across Egypt. Redemption frequency varies depending on the fund. Some funds offer daily redemption, while others provide weekly redemption. However, in all cases, orders must be submitted before 12:00 pm on any applicable day.

Mutual funds are investment vehicles that pool money from multiple investors to invest in a diversified portfolio of capital market instruments, including equities listed on the stock exchange, treasury bills, treasury bonds, or other securities. Each investor in a mutual fund owns shares of the fund, representing a portion of the overall holdings. These shares are referred to as Investment Certificates, symbolizing the investor’s ownership in the mutual funds. The primary objective of mutual funds is to provide investors with access to a diversified portfolio managed by professional fund managers, reducing risk compared to investing in individual securities. Investors benefit from the collective buying power, professional management, and diversification of the fund, which can be difficult to achieve on their own.

All mutual funds announce the Investment Certificate price on a weekly basis, allowing investors to track their performance. Additionally, the fund manager publishes quarterly fact sheets that provide insights into the fund’s performance.
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Q2 2015 Financial Results

CREDIT AGRICOLE EGYPT

PRESS RELEASE

The Bank has reported a net income after taxation for 1st half 2015 of EGP483.0 million compares with EGP310.2 million in 1st half 2014, and has therefore increased by 55.7%. from a core business performance.

Strong Loans growth continued:

Loans growth continued in the second quarter, as total gross loans reached 14.4 billion with 10.4% growth over end of 2014 and 8.4% over same period last year driven by all business lines. While deposit grew by 2.0% over December 2014 and 5.8% over same period last year, low cost deposits is the major contributor for deposits growth 15.5% over December 2014 and 39.5% over June 2014, loans to deposits ratio reached 53.% by end of June 2015 comparing with 49.0% as December 2014.

The Bank’s activities on the whole, performed very well. We had opened two new branches in the second quarter (Shoubra and Madinaty) accordingly our branches network reached 78 branches by end of June 2015. Number of customers increased by 2.6%(net) over first quarter 2015 and by 8.3% over same period last year.

After strong Q1 2015 results, Q2 2015 results at highest level ever :

EGP Million

Q22015

Q22014

Change

H12015

H12014

Change
Net Interest Income

390.4

290.6

34.3%

756.0

571.6

32.2%
Net Fees & Commission Income

124.9

121.2

3.0%

243.7

223.4

9.1%
Net Trading Income

35.8

29.8

20.4%

91.1

62.6

45.5%
Other Operating Income

12.9

2.5

420.1%

18.9

12.3

54.0%
Net Banking Income

564.0

444.1

27.0%

1,109.7

869.9

27.6%
Total Expenses

(189.9)

(171.9)

10.5%

(384.5)

(346.5)

11.0%
Gross Operating Profit

374.1

272.2

37.4%

725.2

523.4

38.6%
Other Income

7.6

10.5

-28.3%

18.5

9.4

96.9%
Income Before Impairment &Tax

381.7

282.7

35.0%

743.7

532.8

39.6%
Impairment

(25.6)

(44.7)

-42.7%

(51.1)

(86.4)

-40.9%
Net Income Before Tax

356.1

238.1

49.6%

692.6

446.4

55.2%
Tax

(106.8)

(82.0)

30.3%

(209.6)

(136.1)

54.0%
Net Income

249.2

156.1

59.7%

483.0

310.2

55.7%
Cost / Income Ratio

33.7%

38.7%

  

34.7%

39.8%

  

 

Net interest income increased by 32.2% year over year driven by loans growth and better margins on deposits. Net commissions and fees increased by 9.1% over last year as result of growth in trade finance activities along with increase in net fee income due to increase in customers activities and growth in retail loans. While other income (comprising FX, Option Premium, Trading and Investment Income) revenues were up by 45.5% year over year and (20.4% over Q2 2014) benefiting from some market opportunities. On the other front total expenses increased by 11.0% over last year representing increase in staff costs and depreciation. Consequently cost to income ratio remarkably improved to reach 34.7% comparing with 39.8% as of end of June 2014.

Our operating profit before provisions and taxation reached EGP 743.7 million comparing with EGP 532.8 Million in H1 2014 with growth rate 39.6%.

Cost of risk reached 51.1 million 40.9% below same period last year as June 2014 was impacted by one sizeable Corporate NPL. Retail share in COR increased in 2015 driven by increase in loan booking, coverage ratio is 193% as of June 2015 comparing with 162.5% in June 2014.

Despite increase of tax rate from 25% to 30%, income after tax grew by 55.7% to reach EGP 483.0 million. Our Return on Equity is 39.2% in H12015 and our Capital Adequacy Ratio reached 14.99% evidencing satisfactory solvency and significant capacity to grow activities.

These results are consistent with the bank general ambitions of achieving in the future the same level of profitability , regularly improving Cost income ratio and growing revenue while supporting the development of the Egyptian economy and of our customers.

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