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International purchase of treasury bills falls to lowest since 2011: CBE report - Daily News Egypt

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International purchase of treasury bills falls to lowest since 2011: CBE report

The CBE will institute a hedging mechanism with a unified dollar exchange rate to attract international purchase of government debt instruments in April, says analyst


The Central Bank of Egypt (CBE) has failed to attract international buyers to the treasury bill programme it announced in January.

In a report issued on Monday, the CBE outlined the banking sector’s financial indicators; the central bank reported international buyers purchased EGP 226m in Egyptian treasury bills through the end of January, equivalent to $2.9m at an exchange rate of EGP 7.73.

The EGP 226m is the lowest volume of treasury bill investment since the 25 January Revolution.

International parties were the fourth largest buyers of Egyptian treasury bills before the 2011. International parties invested EGP 56bn in treasury bills in December 2010.

Tamer Youssef, the head of a treasury department at an Egyptian commercial bank, stated that he expects international parties to invest Egyptian debt instruments in April in accordance with the adoption of a currency hedging mechanism.

The CBE will allow private and public banks to institute a funding mechanism for international buyers that is based on a unified US dollar exchange rate when entering and exiting the Egyptian market, according to Youssef.

International parties invested approximately $500m in government debt instruments in March, according to a previous statement made by the CBE Governor Tarek Amer. However, the CBE has not official confirmed this figure.

The volume of loans provided to debtors increased by EGP 6.4bn from EGP 786.7bn in December 2015 to EGP 793bn in January 2016, according to the CBE report.

The volume of the government loans amounted to EGP 101.17bn, while the volume of loans in the private sector amounted to EGP 691.89bn.

The volume of bank deposits increased by about EGP 8.9bn from EGP 1.914tn in December 2015 to EGP 1.923tn in January 2016.

According to the CBE, the size of government deposits at banks increased to EGP 305.5bn, while non-government deposits increased to EGP 1.617tn.

https://www.dailynewsegypt.com/2016/04/19/international-purchase-of-treasury-bills-falls-to-lowest-since-2011-cbe-report/
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