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EBRD cooperates with FRA to introduce short-term instruments

Sat, Dec. 22, 2018
CAIRO – 22 December 2018: The European Bank for Reconstruction and Development (EBRD) worked with Egypt’s Financial Regulatory Authority (FRA) on the introduction of the new short-term debt instruments (STDIs), which were approved last week.

“The EBRD is strengthening the private sector in Egypt with support for the development of new short-term debt instruments that make it easier for corporate borrowers to tap the market for working-capital funding,” the bank clarified in a statement.

EBRD said that before the issuance of this decision, the Egyptian government was the only issuer of short-term securities, noting that this decision is an important change as it will open the market to corporate issuers for the first time.

“STDIs are analogous to commercial paper, an important and well-established instrument in other markets. The new instruments are attractive to local issuers because they offer maturities as short as seven days and may be listed and traded on an exchange,” the bank stated.

According to EBRD, “The application and issuance process has also been simplified, giving borrowers almost instant access to market liquidity, while permitting a program of issuances lasting up to two years with a single approval.”

The statement noted that the new instruments will provide access to previously untapped local liquidity from money market funds and other lenders to support working-capital needs, while reducing the reliance on the country’s banks and freeing up additional liquidity in the financial sector.

Previously, the Financial Regulatory Authority (FRA) issued decree No. 172 of 2018 concerning the rules and procedures for issuing and offering short-term bonds, determining which companies are entitled to issue and offer short-term bonds.

FRA determines rules, procedures for short-term bonds' issuance

CAIRO - 18 December 2018: The Financial Regulatory Authority (FRA) issued decree No. 172 of 2018 concerning the rules and procedures for issuing and offering short-term bonds. The authority determined, through the decision, which companies are entitled to issue and offer short-term bonds.




By the beginning of December, EBRD enhanced its support for Egyptian exporters and importers with a $50 million trade facility to the Arab African International Bank (AAIB) Egypt.

EBRD provides $50M trade facility to Arab International African Bank

CAIRO - 4 December 2018: The European Bank for Reconstruction and Development (EBRD) announced enhancing its support for Egyptian exporters and importers with a $ 50 million trade facility to the Arab African International Bank (AAIB) Egypt. "AAIB is the fifth-largest bank in Egypt.




EBRD has invested over €4.5 billion in 87 projects in Egypt so far, in addition to providing technical assistance to more than 750 small and medium-sized local enterprises, as Egypt is a founding member of the EBRD and has been a country of operations since 2012.
 
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