How to build a resilient company — and ensure its survival amid headwinds: EFG Holding has focused on building a resilient and shock-immune company over the past several years as the goal became “not a choice, but a matter of survival,” CEO Karim Awad said at FII9 in Riyadh last week, where EFG Hermes was the only Egyptian private sector participant (watch, runtime: 24:34). For EFG Holding — particularly considering the volatility of the Egyptian market and its macro conditions over the past several years — embedding resilience and building a shock-ready business model were existential imperatives, Awad said.

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When its core capital market business began facing volatility following the 2011 revolution, EFG focused first on controlling internal variables. “The first thing that we had to do to build a resilient model is control what we had under our control, which was our cost base. We started cutting our costs and became leaner to make sure that if any further shocks come in the future, we’re ready for them.”

Beyond cost reduction, EFG Holding had to fundamentally break and rebuild its structure. The strategy required abandoning comfortable, profitable but ultimately “non-synergistic” assets, pointing to EFG’s decision to exit Credit Libanais in 2018. The move to sell the asset and pivot came as the firm prioritized building a resilient structure. EFG Holding has also focused on diversification — both geographically and through lines of business — with an expanded presence and commitment across the region.

That entailed investing “a lot more effort” into markets like Saudi Arabia, Kuwait, and the UAE, while product diversification helped EFG mitigate its exposure to capital markets volatility. These diversified products provide “annuities and make sure that the business is shock ready for anything that comes in the future.”

Leading successful transitions with the aim of building a resilient business also requires governance, Awad stressed. Leaders need to be willing to “break things again,” even if it means sacrificing short-term performance in favor of the long-term strategy: “You have to have a patient board because sometimes breaking things means that you do not have the actual quarterly earnings that you want to achieve and that things take time to build.”

ALSO FROM FII9: EFG’s Ebeid touches on the regional angle of financial deglobalization: Capital flows in the Middle East have seen a gradual recalibration, with a shift from “just exporting capital” from the GCC in particular towards a more balanced capital flow structure where partnerships are the name of the game, Mohamed Ebeid, Co-CEO of EFG Hermes said at FII9 (watch, runtime: 28:40). Speaking at a panel alongside Islamic Development Bank Chairman Muhammad Al Jasser and Head of Investment and Corporate Banking at Mizuho Americas, Michal Katz, among others, Ebeid noted that “there have been a lot of partnerships coming from international investors; rather than just trying to do one-time offshore business, now they’re doing it more with local institutions and sovereign wealth funds in a more balanced way.”

That shift has also presented itself in how financing happens: “Rather than looking at global syndication from global banks, there have been sovereign sukuk issuances from governments [in the region] and different local institutions. There’s more dependency on regional private wealth, Ebeid noted. EFG Hermes’ IPO agreements also tell the same story in ECMs: In 2024, EFG Hermes led c.USD 18 bn worth of ECM transactions, with local and regional institutions, family offices, and high net worth individuals accounting for 70% on average of any transaction.

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