A Middle East Broker Has Big Plans for West Africa

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EFG-Hermes Holding SAE, one of the top brokers in Nigerian equities this year, plans to increase its offering in the West African country to include dealing in fixed-income securities.

“We’re currently looking at expanding our local offering to include fixed-income trading, a structured-products offering, as well as a local investment-banking offering,” Ali Khalpey, the chief executive officer of the Cairo-based company’s frontier unit, said in an emailed response to questions. The plan is to “cover West Africa out of our Lagos hub,” he said.

EFG acquired a Nigerian brokerage in 2018 and accounted for 20% of the value traded on the Nigerian Stock Exchange in the week through Aug. 21, according to data compiled by the Lagos-based bourse. The company plans to capitalize on demand for Nigerian debt securities such asTreasury bills, open market operations auctions and long-term government bonds, despite lower returns and difficulty in repatriating funds by foreign investors.

The company plans to complete two initial public offerings from the financial services industry next year, one of which will be from Nigeria, he said, without giving more details. The transactions, initially earmarked for this year, were delayed by the coronavirus pandemic.

EFG-Hermes expects Nigeria’s economy to contract 4.5% in 2020 and start to recover from next year, the broker said in a report released this week.

©2020 Bloomberg L.P.

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