Egypt’s A.T. Lease deters securitisation bond scheme on ‘high interest rates’

Egypt-based Shariah-compliant leasing firm, A.T. Lease decides once again to postpone the issuance of 2 billion Egyptian pound ($111.8 million) securitisation bonds due to the growing interest rates.

“The securitisation was part of A.T. Lease’s five-year plan to finance upcoming activities, but we are forced now to postpone this move as a result of the continually rising interest rate,” chief executive Tarek Fahmy told Amwal Al Ghad o Wednesday.

A.T. Lease’s five-year plan involves a financing portfolio of 1.6 billion pounds, 0 percent insolvency, and a 15 percent market share by the end of 2016, he stated.

“The high interest rates will raise the costs of the issuance process and increase the financial burdens on us; we hoped to issue the bonds early 2017 but now we will wait and see if the central bank decides to lower the interest rates.” Fahmy added.

Earlier, Egypt’s central bank decided on November 3rd to freely float the pound and raise key interest rates by 300 basis points. The overnight deposit rate, the overnight lending rate and the rate of the CBE’s main operation have been raised to 14.75 percent, 15.75 percent, and 15.25 percent respectively.

A.T. Lease commenced its operations in 2006 to be the first Islamic Shariaa Compliant leasing company in Egypt.

The ownership of A.T. Lease is divided over three entities, 89.9 percent for Arab Moltaqa Investment Company (AMIC), 10 percent Dallah Al-Baraka Group (DBG), and the remainder is owned by A.T.Brokerage in Bahrain.