Bloomberg News

Egypt Offers $662 Million of T-Bills as Saudi Aid Nears Arrival

May 06, 2012

Egypt will offer 4 billion Egyptian pounds ($662 million) of three- and nine-month treasury bills as Saudi Arabia said it would this month start “implementing” an aid package agreed on almost a year ago.

The average yield on the three-month securities rose three basis points to 13.938 percent and nine basis points to 15.616 percent on the longer notes at the last sales, according to central bank data on Bloomberg. The North African country will seek bids for 1 billion pounds in the shorter-term notes and 3 billion pounds in nine-month bills.

Saudi Arabian aid, part of a package of about $4 billion announced in July 2011, is being discussed by officials from both countries and will be implemented in the “coming few days,” the kingdom’s ambassador to Cairo Ahmed Qattan said on Al Arabiya television May 3. Qattan returned to Cairo yesterday after he was recalled more than a week ago following protests outside Saudi Arabia’s embassy after the arrest of an Egyptian human rights activist in the kingdom.

Egypt’s foreign currency reserves, which have fallen for the last 15 months to the lowest level in more than seven years, were expected to show improvement in April or May on the expectation that Saudi aid will arrive, Finance Minister Momtaz el-Saieed said last month. Reserves fell to $15.1 billion in March, enough to cover 3.1 months of imports, according to Bloomberg calculations based on official data. That’s down from 8.7 months in December 2010.

The yield on the Egypt’s 5.75 percent dollar bonds due in 2020 retreated three basis points, or 0.03 of a percentage point, to 6.89 percent on May 4, according to prices compiled by Bloomberg. That’s the lowest level in three weeks. The Egyptian pound, subject to a managed float, strengthened less than 0.1 percent to 6.0438 a dollar.

To contact the reporter on this story: Ahmed A Namatalla in Cairo at anamatalla@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net


Too Cool for Crisis Management
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus