The Central Bank of Egypt (CBE) has successfully attracted $1.17 billion in bids during its latest auction of US dollar-denominated treasury bills.
The auction significantly surpassed its initial offering of $950 million and featured one-year bills set to mature on April 28, 2026. The proceeds are earmarked to repay a previous issuance from April 30, 2024, which had raised $997.6 million.
According to data published on the CBE’s official website, the bank accepted 20 bids totaling $984.9 million at an interest rate of 4.25%. While some investors submitted bids with yields as high as 5.1%, these higher-yield offers were rejected.
The CBE permits both domestic banks and foreign institutions to participate in these dollar-denominated treasury bill auctions, with a minimum subscription of $100,000 and in multiples thereof.
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Subscriptions follow the same procedures as local currency treasury bills. Each primary dealer bank submits its bid to the Central Bank, indicating the desired investment amount and proposed interest rate. The CBE then reviews and accepts bids that align with its criteria.
The yield on these instruments is influenced by several factors, including global US dollar interest rates, alternative investment opportunities available to financial institutions, and Egypt’s sovereign credit rating.
This robust demand for the CBE’s dollar-denominated treasury bills reflects investor confidence in Egypt’s financial instruments and the central bank’s monetary policies. By attracting substantial foreign currency investments, the CBE aims to bolster its foreign reserves and manage liquidity in the domestic market.
