Mon, Feb 14, 2011 - Page 10 News List

Egypt to sell US$1.1 billion in post-Mubarak bill sale

Bloomberg

Egypt planned to sell 6.5 billion Egyptian pounds (US$1.1 billion) of Treasury bills yesterday, the first auction after the resignation of former Egyptian president Hosni Mubarak.

The Ministry of Finance will offer 3 billion pounds of 91-day bills and 3.5 billion pounds of 266-day notes, according to central bank data on Bloomberg.

The government raised 3.5 billion pounds from the sale of 182-day bills on Thursday, paying the highest yield in more than two years. The stock exchange, which has been shut since the end of trading on Jan. 27, yesterday delayed its opening until Wednesday.

“We are starting to get back to normal, but there are still a few twists and turns along the road,” Wael Ziada, head of research at Cairo-based investment bank EFG-Hermes Holding SAE, said in a telephone interview.

“The entity ruling today has to send a very strong message that Egypt is committed to reforms, that there will be reforms,” he said.

The yield on Egypt’s 5.75 percent dollar bond due in 2020 dropped 15 basis points to 6.35 percent on Friday, according to data compiled by Bloomberg. The cost of insuring government debt against default fell 16 basis points to 322 at the close in London, according to CMA prices for credit-default swaps.

The stock exchange will give companies a chance to divulge “all information about their financial and operational situation, which will give investors the ability to evaluate the latest developments and take the appropriate investment decisions,” the Cairo-based exchange said.

The bourse said last week it planned to resume operations yesterday.

About 50 investors demonstrated in front of the exchange on Thursday, asking for the suspension to continue over concerns that political instability may affect their holdings, the bourse said.

The country’s benchmark stock index tumbled 16 percent in the week ending Jan. 27.

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