Dr Tristan Clube

'These have not been easy times for investment bankers, and we have been through the full cycle in Egypt,' says Dr Tristan Clube, executive director of asset management who works out of the Emirates Towers skyscraper in Dubai. 'Following a recent merger we have seen our combined headcount fall from 800 to 300, and have decided to partly focus on regional expansion outside our base in Cairo.

'From the point of view of asset management EFG-Hermes will now be researching companies to add to its investment portfolio from the Dubai office, and also developing links with the local banks to market our numerous mutual funds. These may become white-label products for local banks across the GCC.

An Oxford University graduate and formerly head of emerging markets at Martin Currie Investment Management, Dr Clube admits EFG-Hermes is not so well known in the prosperous Gulf markets. But as an asset manager EFG-Hermes is outstanding in its exclusive focus on the Middle East and Africa, and total funds under management now exceed $300 million. This is a lot of money in such shallow capital markets.

The asset management team has 12 investment professionals and as many support staff operating out of offices in Egypt, Edinburgh and Dubai. This includes one of the largest pools of buy-side analysts devoted exclusively to this region.

'We are launching the first Iran equity fund for international investors, and other single country funds in the GCC are a distinct possibility in the future,' says Dr Clube. 'The GCC markets are developing quite fast, and we expect Qatar to approve mutual fund regulations soon'.

'The great thing is that in this region there are still listed companies with high dividends, low price-to-earnings ratios and no debt. This is the right combination for investors' today, and part of my role is researching companies that fit this profile for our own funds to invest in.'

EFG-Hermes product portfolio consists of Egyptian onshore and offshore funds, an Islamic fund, a general regional equity fund, a regional TMT fund, and segregated accounts covering Egypt and the region. Further details are available on a comprehensive website, www.efg-hermes.com.

'An emphasis on quality people and proprietary research has paid dividends over the years through superior investment results,' says Dr Clube. 'In four of the past five years, the best performing equity fund in Egypt has been part of our stable of funds. Our two initial private equity funds are among the best performers in the region with IRRs in the 50-60% range.'

Aside from asset management, EFG-Hermes is probably better known as a leading investment bank in Egypt, responsible for deals such as the $320 million Orascom Telecom IPO in July 2000 and subsequent $413 million acquisition of Telecel by Orascom Telecom. There have also been large deals in the cement and foods sectors in Egypt.

EFG-Hermes has been quoted on the London and Cairo stock exchanges since 1998, and merged with Fleming CIIC last year to create Egypt's largest investment bank.
With this pedigree it will be interesting to watch what impact EFG-Hermes will make on the Gulf region where opportunities still look much brighter than in its home country.