Courts go after delinquent debtors

04 October 2002

Public prosecutor Maher Abdel-Wahed is pursuing action against a former head of one of Egypt's largest banks and against several prominent businessmen as part of a campaign to deal with the country's chronic bad debt problems. Abdel-Wahed announced on 2 October that Mohamed Abol-Fath, former chairman of Banque du Caire, has been banned from leaving the country. This follows an investigation into some£E 12,000 million ($2,600 million) in credit advanced by the bank, which the prosecutor alleges did not have sufficient guarantees. In mid-September, a travel ban was imposed on former Misr Exterior Bankmanaging director Abdallah Tayel in connection with investigations about credit advanced by the bank under his tenure.

The prosecutor is also investigating Hossam Abul-Futtouh - best known as the agent for Germany's BMW- and steel traders Hatem el-Hawary and Mohamed el-Gerhy over loans contracted from several Egyptian banks.

The Cairo daily Al-Ahram reported on 3 October that 35 business people in all are being investigated over loans totalling £E 37,000 million ($8,000 million). They include a number of notorious figures who have left the country - a leading healthcare investor, a retail investor involved in a failed venture with a large European supermarket chain and a prominent female banker.

These high-profile cases come as Central Bank of Egypt governor Mahmoud Abul-Eyoun has been urging banks, wherever possible, to reach amicable settlements with problem debtors (see Special Report, page 32).

A MEED Subscription...

Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications