The Central Bank of Egypt (CBE) will offer a tender of treasury bills (T-bills) denominated in the European currency, at a value of €600m.
This tender is offered for a period of one year and it’s due on 12 August 2024, and its proceeds are directed to repaying a previous tender, which was raised on 16 August 2022, at a value of €626.9m.
CBE received 30 offers from local and foreign investors, at a value of €859.2m, to cover the last similar bid that was issued on November 7, 2022, at a value of €690m.
CBE accepted 24 of those offers, at a value of €699.2m. Their interest rates range between 2.29% as the lowest price, 2.3% as the highest price, and 2.3% as the average.
Some institutions requested a return of 3.20%, which was rejected by the Central Bank of Egypt.
It is noteworthy that CBE started issuing treasury bills in euros on August 28, 2012, and the first return granted by the Ministry of Finance on these bills was 3.25%.
CBE allows subscribing to bills in euros for both local banks and foreign institutions, with a minimum subscription of €100,000 and its multiples.
Banks subscribe to T-bills in euros in the same manner followed in issuances of T-bills in local currency, whereby each bank submits its bid to CBE, indicating in it the amount that it will subscribe to in bills and the interest rate it requests.
Banks operating in the local market rely a lot on these T-bills to invest their liquidity in euros 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 from time to time, or investing in the global money markets.
