The Central Bank of Egypt (CBE) received 23 bids worth $1,076bn to cover the tender for treasury bills denominated in US currency, which it put out Monday, on behalf of the Ministry of Finance.
The Central Bank had offered this bid at a value of $1bn for a period of one year, due on 30 April 2024, and its proceeds were directed to pay the maturity of a previous bid that the Central Bank had put forward on 3 May 2022, through which it obtained $1.0168bn.
According to Central Bank data, on its website, the bank accepted 20 of those offers at a value of $1.0076bn, with interest ranging between 4.899% as the lowest price, 4.9% as the highest price, and 4.9% as an average, with little change from the return rate in the last similar bid introduced in February 2023.
The Central Bank allows both local banks and foreign institutions to subscribe to those bills, with a minimum subscription of $100,000 and its multiples.
Investors subscribe to dollar-denominated T-bills in the same manner as issuances of bills in local currency, whereby each bank of the “primary dealers” submits a subscription application to the Central Bank, indicating in it the amount that will be subscribed to in the bills and the interest rate it requests, and the requests are collected at the Central Bank for study and appropriate acceptance.
The return of those dollar bills is determined according to several indicators, the most important of which are interest rates on the dollar in global markets, alternative investment opportunities available to local and foreign banks and financial institutions, and the country’s credit rating.