CAIRO - 14 February 2024: Egypt has canceled the issuance of treasury bonds (T-bonds) valued at LE 34.5 billion ($1.12 billion) in the first half (H1) of the Fiscal Year 2023/2024. This decision was influenced by the high returns demanded by banks from potential investors.
However, during the same period, the government successfully offered T-bonds worth around LE 7 billion for durations ranging from 3 to 7 years, with an average return rate between 23 and 25 percent.
Comparing the H1 of the FY23/24 to the H1 of the FY22/23, there has been a decline of 92 percent in local T-bond issuances.
An unnamed ministry of finance source cited by Ashraq Bloomberg said it was natural to cancel the T-bonds offers “when the return rate exceeded 25 percent from banks.”
In contrast, Egypt has experienced an increase of approximately 59 percent in the issuance of government debt instruments denominated in local currency, reaching a total of LE 2.7 trillion in the H1 of FY23/24, as reported by Asharq Bloomberg based on data from the Central Bank of Egypt.
Egypt aims to meet its financing requirements for the FY23/24, estimated at LE 2.14 trillion, primarily through local financing by issuing T-bonds and bills amounting to LE 1.95 trillion.
In February, Minister of Finance, Mohamed Maait, disclosed that the outstanding balances of local T-bonds and bills in Egypt amounted to approximately LE 4.962 trillion by the end of 2023.
According to the latest report on the official website, the outstanding balances from treasury bills include roughly LE 2.670 trillion, with approximately LE 1.172 trillion for 364-day bills, LE 229.796 billion for 273-day bills, LE 395.297 billion for 182-day bills, and approximately LE 872.638 billion for 91-day bills.
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