Bankers have different opinions on the chairman of Sainsubry’s Group Amr Al Nasharty’s settlement deal of EGP 377 million debts owed to National Bank of Egypt and EGP 67 million debts owed to Suez Canal Bank.
Some bankers said that settling Al Nasharty’s debts in return for acquiring assets is the optimal solution while others said that encouraging Al Nasharty to invest in Egypt to repay his debts will encourage insolvent investors who fled the country to return and inject investments so as to boost national economy.
Bassant Fahmy, banking expert and former consultant at Al Baraka Bank, said that debt settlement is the best way to boost economy. Fahmy noted that Al Nasharty’s return to Egypt to settle his debts will encourage insolvent investors to do the same.
Central Bank of Egypt and Egyptian banks are responsible for these insolvency cases as they do not apply the regulations and laws, Fahmy added.
In addition, Fahmy rejected Al Nasharty’s suggestion of partnering with the bank in a company in which the bank will acquire a share equivalent to the debt’s value because commercial banks as National bank of Egypt is not specialized in long-term investment and that may make Al Nasharty insolvent again. Accordingly, the solution is settling the debts. However, Alaa Samaha, former consultant of minister of finance and former chairman of Blom Bank, said that encouraging insolvent businessmen to invest in the country will boost Egypt’s economy and improve production.
Partnering with Al Nasharty to settle his debts is the best way of debt settlement NBE and Suez Canal bank would do together with setting a precise plan that will guarantee the banks’ dues, Samaha said as he considers bankruptcy announcement will make insolvent businessmen refrain from settling their debts.