Finance Ministry Sells 91-, 273-Day T-Bills Worth EGP 5.5 Bln

The Egyptian Ministry of Finance sold 91- and 273-day T-bills worth EGP 5.5 billion on Sunday.

The Ministry raised EGP 1.5 billion from 91-day T-bills and EGP 4 billion from 273-day T-bills.

The yields on 91-day T-bills ranged from 12.252% to 12.781%, while the average return registered 12.723%. The yields on 273-day T-bills ranged from 13.750% to 13.841%, while the average return registered 13.823%.

This has raised the value of treasury bills and bonds offered by the Ministry to EGP 45.5 billion since the beginning of February, in addition to dollar-denominated T-bills worth US$ 819 million. The Finance Ministry targets to sell treasury bills and bonds worth EGP 52.5 billion in February.

The Ministry sells treasury bills and bonds so as to finance the widening budget deficit which reached EGP 91 billion in the first half of FY 2012/2013, and is expected to reach EGP 200 billion by the end of the current fiscal year.

Alaa Samaha, adviser to the former of the Minister of Finance, stated that the current banking systems do not play its role in boosting economy as they rather focus on investing in government debt instruments as their return exceeded 16% and also have no investment risks. Accordingly, many banks forget their main role of financing developmental projects, he added.

Samaha called on CBE to issue a legislation limiting the rate of banks’ investments in treasury bills and bonds to make banks invest more in commercial sectors.