The Central Bank of Egypt (CBE) will on Monday offer a local Treasury bill auction denominated in US dollars, valued at $950m, with a tenor of 364 days, maturing on 1 December 2026.
The proceeds of this auction will be directed towards repaying a previous T-bill issuance offered on 3 December 2024, through which bids worth $980.5m were accepted, and which falls due on Tuesday.
It is worth noting that the CBE had received 28 bids amounting to $1.6673bn for a similar auction launched on 11 November this year, valued at $1.5bn, with a 363-day tenor maturing on 10 November 2026.
According to data published by the CBE on its official website, 21 of those bids were accepted, amounting to $1.5473bn, at a yield of 3.749%, which is approximately half a percentage point lower than the yield of the previous comparable auction offered on 2 June, which stood at 4.25%.
Some investors in the new auction requested yields as high as 4.3%, which were rejected by the CBE.
The Central Bank allows both local banks and foreign institutions to subscribe to these bills, with a minimum subscription of $100,000 and its multiples.
Investors subscribe to the dollar-denominated bills in the same manner used for local-currency T-bills. Each primary dealer bank submits a subscription request to the Central Bank, specifying the amount it wishes to purchase and the yield it is requesting. The CBE then reviews all submitted bids and accepts those deemed suitable.
The yield on these dollar-denominated T-bills is determined according to several indicators, the most important of which are global dollar interest rates, the alternative investment opportunities available to local and foreign banks and financial institutions, and the country’s credit rating.
