In a deal considered to be the largest divestment of Egyptian state assets to date, the government in Cairo last month completed the sale of Bank of Alexandria (BOA) – Egypt’s fourth largest bank – to Italy-based Sanpaolo IMI, generating over $1.6 billion in revenues for the state. The proceeds are expected to be used to re-capitalize other state-owned banks and to reduce Egypt’s public debt. More importantly, however, the successful sale sets a new benchmark in Egypt’s privatization drive and program to reform the banking sector. Sanpaolo won the bid to acquire 80% of Bank of Alexandria on October 18 after a long and draining process as it was competing against five large regional and international players: Jordan-based Arab Bank, Mashreq Bank of the United Arab Emirates, BNP Paribas, EFG Eurobank Ergasias of Greece and Egypt’s Commercial International Bank. Under the privatization arrangement, 15% of BOA will be floated
