Commercial International Bank said on Sunday a firm owned by Dubai's ruler had bought a 5.24 percent stake in the bank, the Gulf emirate's second major investment in a year in Egypt's financial sector.Dubai Capital Group, part of government-owned Dubai Holding, had accumulated the stake of Egypt's largest publicly traded lender from the Egyptian and London stock exchanges over the past few months, a CIB spokesman said, without giving details.
Dubai Holding is owned by Dubai's ruler Sheikh Mohammed bin Rashid Al-Maktoum.
Dubai Capital Group Chief Executive Mustafa Farid Geninah said in the statement: "This investment [provides] us opportunities in an environment which has been challenged by the changes in the global financial services sector."
Another Dubai government-owned firm bought a 25 percent stake in EFG-Hermes , Egypt's largest investment bank by market value, in November.
"The potential growth in Egypt is so much greater than in Dubai," said Angus Blair, head of research at Egyptian investment bank Beltone Financial. "The fall in the stock market has made the stock more attractive."
Shares of CIB, which said in May talks to merge with Arab African International Bank had ended, have tumbled 20 percent this year to Thursday's close. Egypt's benchmark CASE 30 index is down 12 percent this year.
Shares of the bank, which posted a 67 percent surge in first-quarter profit, closed 0.2 percent higher.
"It is a vote of confidence in CIB that a leading regional group such as Dubai Capital is investing and believes that CIB has the potential to develop its activities," said Elena Sanchez-Cabezudo, banking analyst at Egypt investment bank EFG-Hermes.
Egypt, the fourth-largest Arab economy, is growing at its fastest rate in at least two decades after the government cut taxes and sold state assets.
CIB spokesman Sherif Khalil said the bank informs its shareholders when any group acquires 5 percent or more.
Dubai Capital Group had informed the Central bank of Egypt of its acquisition but it did not need central bank permission, he added.
US buyout firm Ripplewood, the largest investor in CIB, leads a consortium that owns 18.7 percent of the Egyptian lender. (Reuters)
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