The Central Bank of Egypt (CBE) received 23 offers worth $565.1m to cover a treasury bill issuance denominated in the US currency.
The Central Bank launched this tender, on Monday, at a value of $540m, for a period of 364 days, due on 6 June 2023.
The proceeds of this tender are directed to pay off a previous tender that the Central Bank put forward on 8 June 2021, through which it obtained $540m.
According to data from the Central Bank, on its website, the bank accepted all offers, with interest ranging between 3% as the lowest price, 3.05% as the highest price, and 3.044% as the average, compared to 2.97% as the lowest price, 3% as the highest price, and 2.997% as an average, in a similar bid made by the bank on 28 April.
The Central Bank allows subscription in these bills for each of the local banks and foreign institutions, with a minimum subscription of $100,000 and its multiples.
Banks subscribe to dollar bills in the same manner as in local currency bills, where each bank submits its bid to the Central Bank, indicating the amount to be subscribed to in the bills and the interest rate it requests. Bids are collected at the Central Bank for study and acceptance of the appropriate ones.
Banks operating in the local market rely a lot on these bills to invest their dollar liquidity in a container guaranteed by the government, with an appropriate return, in the absence of other investment aspects for that liquidity, except for the rare joint loans that are offered between separate periods, or investing in the global money markets.
The return on these dollar bills is determined according to several indicators, the most important of which are the volume of dollar liquidity in the market, the alternative investment opportunities available to local and foreign banks and financial institutions, and the country’s credit rating.