Return of GDRs to be provided in Egyptian Pounds

The Egyptian Financial Supervisory Authority (EFSA) has approved the Egyptian Stock Exchange’s (EGX) request to provide the return value of global depositary receipts (GDRs) in Egyptian pounds instead of dollars.

GDRs are stocks of companies traded in foreign capital markets. Egyptian investors can trade in these stocks in foreign capital markets but only through brokerage companies. Investors used to buy and sell in foreign currency, mainly dollars. Following the EFSA’s decision, the return of such trade will be provided to the investor in Egyptian pounds, instead of hard currency.

EFSA Chairman Sheirf Samy said this mechanism was used to attain foreign currency in an “excessive manner” during the past period.

Samy added that the decision does not influence the capital market’s role as an “investment tool”.

The benchmark index EGX-30 has recorded 8,511.98 points on Monday, declining by 1.65%.

The broader index EGX-100 dropped by 1.12%, registering 941.77 points, while the small and medium enterprises index EGX-70 closed at 444.69 points, slumping by 1.34%. The capped index EGX-20 declined by 1.56%, marking 8543.63 points.

According to the market capital’s historical data, the EGX registered EGP 4.5bn in losses on Monday.

Source: Daily News Egypt