Egypt has successfully raised $4bn from its first public bond issuance, after the approval of a loan from the International Monetary Fund (IMF), according to Egypt’s Finance Minister Amr El-Garhy.
The $4bn was distributed across 5-year, 10-year, and 30-year bonds at a face value of 6.125%, 7.5%, and 8.5%, respectively. The bonds were geographically distributed between North America (50%), Europe (40%), Asia, and the Middle East. El-Garhy explained that there was a very strong demand, and that the bonds had been covered several times, adding that Egypt is planning to be a frequent bond issuer depending on its needs and on the global market’s conditions as well. The combined order books for the bonds exceeded $13.5bn, which is almost 3.5 times the value needed by Egypt.
Egypt is expected to receive the $4bn by the end of January or early February. This bond issuance is the biggest in Egyptian and African history, according to El-Garhy. Egypt has issued $1.5bn worth of government bonds earlier in 2015, he added, stating that the increase on demand for Egyptian bonds reflects the progress in the Egyptian economy after the economic reform programme was adopted.
Egypt has been seeking to bridge its financial gap from a variety of funding sources, including grants, loans, aid, and the issuance of bonds, according to an IMF report.
