EFG-Hermes Q2 net falls as EU, US crises weigh

Egyptian investment bank EFG-Hermes said on Sunday second-quarter net profit fell 45 per cent as investors were rattled by the European debt crisis and weak US recovery.

The firm, Egypt's largest listed investment bank, said net profit fell to 96.4 million Egyptian pounds ($16.9m) from 176m pounds in the same period of 2009.

That was above forecasts of 74m pounds from analysts at HSBC and 87m pounds from Bank of America Merrill Lynch.

Fees and commissions, which made up the biggest portion of revenue in the second quarter, declined 10.6 per cent to 205m pounds as regional volumes traded halved over the year, EFG said.

It blamed the decline on a souring of sentiment due to the Greek debt crisis and fears of possible repercussions in the Spanish and Italian banking sectors, as well as a weak recovery in the US economy.

Total revenue for the quarter slipped 9.8 per cent to 346m pounds. Brokerage income also fell 36 per cent.

Total assets under EFG-Hermes' management fell to $5.1bn at the end of the second quarter, compared with $5.5bn at the end of the first.