The country's most profitable financial institution, and the first to receive an investment-grade rating, CIB is involved in a diversification program designed to introduce innovative financial products and services seemingly at the precise moment the country's growing economy requires them. Last year it created an insurance company with the UK's Legal and General, called Commercial International Life Insurance (CIL), and two years ago it launched CIBC, the Commercial International Brokerage Company. In 1999, its first full year of operation, the fledgling brokerage jumped to second or third place in rankings of brokerage houses released by the Cairo and Alexandria Stock Exchange.

CIB has its sights set on a number of BOTs (build-operate-transfer) programs, and last year created a joint venture between its CIIC merchant bank division with Fleming to handle asset and portfolio management. By 2001, CIB expects to generate up to 25% of its income from non-bank financial services, but it will also place heavy emphasis on the retail sector to serve the country's new and growing middle class.

"The plan is to expand from 30 to 50 branches by 2002," explained Hisham Ezz El Arab, CIB's new deputy managing director who was formerly with Deutsche Bank. "We will offer a full range of products including current accounts, check books, life insurance, savings policies and brokerages."

CIB's net income last year was $104.5 million, up from $92.5 million in 1998, with a return on investment steady at about 25% over the past five years. The bank was founded in 1975 as a joint venture between Chase Manhattan Bank, which had 49%, and the National Bank of Egypt, 51%. It was the first such bank privatization and joint venture under an open door policy devised by Egyptian president Anwar Sadat to attract foreign investment into the country's banking system. Chase remained a partner until 1987, when it sold its shares to NBE and the bank changed its name to Commercial International Bank, SAE.

As part of its privatization strategy in 1993, CIB launched a public share issue, which reduced major shareholders' stake to 43%. Some 16% share of the bank's capital belongs to employees, while 41% went to a roster of more than 14,000 Egyptian, Arab and multinational investors. In 1996, CIB sold an additional 20% equity stake through a Global Depository Receipts offering listed on the London Stock Exchange. The first such offering of its kind by an Egyptian company, and among the most successful to date, it raised more than $120 million.

With stellar Standard & Poor's ratings and kudos for the quality of its personnel, CIB maintains an efficient system of internal controls. These will assure a solid future as the Egyptian economy grows, more companies are privatized and the retail banking sector realizes some of the predicted expansion. Hisham Ezz El Arab says the bank is well-placed to weather many ups and downs in the economy, like the current liquidity problem that many say is slowing growth, or threats of a currency devaluation.

"We run a risk management system within our international treasury policy that protects the bank whenever there are some kinds of trouble on the market," he asserts. "It is because of those systems that we haven't felt the crunch the way some other banks have." He remains confident about the future of CIB and Egypt's future financial development and bases those beliefs on a very important precedent.