Tasaheel, a leading Egyptian lender for small businesses and a subsidiary of MNT-Halan, has successfully completed an EGP 7 billion ($138 million) Modaraba Sukuk issuance. This marks the largest sukuk issuance within Egypt’s non-bank financial institutions (NBFIs) sector, reinforcing the company’s mission to expand financial access for underserved businesses. The transaction is a significant milestone in Egypt’s financial sector, highlighting the increasing role of Islamic finance in sustainable economic development.

Largest Socially Sustainable Sukuk Issuance in Africa

Beyond being the largest of its kind in Egypt’s NBFI sector, Tasaheel’s issuance also holds the distinction of being the largest socially sustainable sukuk issued by a non-governmental entity in Africa. The funds raised through this issuance will support Tasaheel’s efforts to provide tailored financial solutions to small businesses and entrepreneurs, strengthening its position as a key player in Egypt’s financial ecosystem. The sukuk aligns with international sustainable finance standards, underscoring the company’s commitment to responsible and inclusive economic growth.

Structure and Compliance with Islamic Finance Principles

The sukuk has been structured as a Modaraba Sukuk with a five-year maturity period, adhering to Shariah-compliant financial principles. It has received certification from both the Central Shariah Committee at the Financial Regulatory Authority (FRA) and the Sukuk Company Shariah Committee to ensure full compliance with Islamic finance regulations. This issuance reflects the growing adoption of Shariah-compliant financial instruments in Egypt, offering investors new opportunities aligned with ethical financing models.

Strong Investor Demand and Credit Ratings

The issuance attracted significant investor interest, achieving a subscription coverage ratio of 1.2 times. It secured an “A” credit rating from the Middle East Credit Rating and Investor Services (MERIS), affirming its strong financial standing. Additionally, it received an “Excellent” (SQS1) sustainability score from Moody’s Rating Agency, aligning with the Sustainable Sukuk Principles established by the International Capital Market Association (ICMA).

Impact on Egypt’s Financial Sector

With the capital raised, Tasaheel aims to enhance its financial solutions for underserved businesses and individuals, promoting greater economic inclusion. The issuance supports MNT-Halan’s broader strategy of tapping into innovative funding channels to expand access to credit. By securing diversified and sustainable financial resources, Tasaheel is poised to further its impact on Egypt’s financial sector and beyond.

Statements from Leadership

Islam Ayoub, Managing Director of Tasaheel, emphasized the company’s commitment to financial inclusion and economic empowerment. He stated that this sukuk issuance allows Tasaheel to extend vital financial support to small business owners, who play a crucial role in Egypt’s economy. Mounir Nakhla, Founder and CEO of MNT-Halan, highlighted that securing innovative financing solutions will help accelerate loan book growth and expand the company’s reach.

Regulatory Oversight and Transaction Support

The issuance was conducted under the supervision of the Egyptian Financial Regulatory Authority (FRA) to ensure compliance with national financial regulations. It was supported by leading financial and legal advisors, including CIB and CI Capital as financial advisors, Maatouk Bassiouny & Hennawy as legal advisors, and KPMG as the transaction auditor. The sukuk was issued by Alkan for Sukuk and underwritten by major financial institutions such as CIB, AAIB, El Baraka, and Banque du Caire, with additional participation from SAIB, ABC, FABMisr, Faisal Islamic Bank, and ADCB.

Tasaheel’s $138 million sukuk issuance marks a transformative step in Egypt’s non-bank financial sector, reinforcing the role of Islamic finance in economic development. By leveraging this funding, the company is set to enhance financial access for small businesses, driving long-term growth and inclusion. This successful transaction demonstrates investor confidence in Egypt’s financial markets and positions Tasaheel as a leader in sustainable and Shariah-compliant financing solutions.