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Egypt Sells Target $663 Million T-Bonds; Dollar Bonds Rose

March 26 (Bloomberg) -- Egypt sold 4 billion Egyptian pounds ($663 million) in treasury bonds and surpassed its monthly fundraising goal for the first time since political unrest started last year. The nation’s dollar bonds rose.

The North African country’s government accepted bids for 2 billion pounds each of three- and five-year bonds, according to central bank data on Bloomberg. It paid average yields of 16.25 percent 16.69 percent, respectively, compared with 16.36 percent and 16.78 percent at an auction of similar-maturity notes two weeks ago. The mid yield on the securities in the secondary market was at 16.075 percent and 16.525 percent, respectively.

The sale allowed the government to exceed its 51.5 billion-pound debt sale goal in March by almost 8 percent, after falling 23 percent short of the 118.5 billion pounds it targeted in the first two months of the year, according to finance ministry data. In all, the finance ministry raised 147 billion pounds out of the 170 billion it sought this quarter because of rising borrowing costs. Yields soared by more than 2 percentage points on nine-month and one-year securities since October.

The central bank on March 20 reduced the local-currency reserve requirement for banks by two percentage points to 12 percent to help “ease credit conditions in the market.”

The yield on the country’s 5.75 percent dollar bonds due April 2020 fell less than one basis point to 6.38 percent at 3:22 p.m. in Cairo, according to prices compiled by Bloomberg. The Egyptian pound lost 0.1 percent to 6.0367 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

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