The Ministry of Finance plans to borrow EGP 388.75bn from the local market in November by launching 24 issuances of treasury bills (T-bills) and bonds. This is part of a larger plan to borrow EGP 1.2635trn in the second quarter of the fiscal year 2023/2024 to repay previous debts and finance the budget deficit.
The Central Bank, acting on behalf of the government, will offer 16 T-bill auctions worth EGP 376bn and 8 bond auctions worth EGP 12.750bn in November.
The plan includes four T-bill auctions for each of the following maturities: 91 days (EGP 91bn), 182 days (EGP 91bn), 273 days (EGP 99bn), and 364 days (EGP 99bn).
The plan also includes six bond auctions for three years (EGP 12.25bn), two of which are variable-yield bonds (EGP 1.25bn), and two bond auctions for five years (EGP 500m).
The banks operating in Egypt are the main investors in the government’s T-bills and bonds, which are issued regularly to cover the budget deficit.
These securities are sold through 15 banks that participate in the Primary Dealers System in the primary market. These banks then resell some of them in the secondary market to individual and institutional investors, both local and foreign.
According to the Ministry of Finance, the outstanding balances of local T-bills and bonds amounted to about EGP 4.67trn by the end of August 2023.
The ministry’s latest report showed that the outstanding balances of T-bills were about EGP 2.449trn, distributed as follows: EGP 1.188trn for 364 days, EGP 210.512bn for 273 days, EGP 524.811bn for 182 days, and EGP 525.698bn for 91 days.
The report also showed that the outstanding balances of bonds were about EGP 2.25trn by the end of August, including EGP 114.122bn of zero-coupon bonds and EGP 28.147bn of variable-yield bonds that were recently offered by the ministry.