On Monday, the Central Bank of Egypt (CBE), on behalf of the Ministry of Finance, issued treasury bills (T-Bills) worth $715m. According to the prospectus of the tender, the CBE will issue the bills for 364 days, due on 11 June 2019. The proceeds from the tender will be funnelled to cover the value of a previous offering posed by the CBE on 13 June 2017 worth $715m and will be due on 19 June 2018. The CBE's last T-Bills offering, worth $1.1bn, was on 7 May 2018. Local and foreign financial institutions have offered $1.28bn in the tender, of which the CBE approved $1.1bn. The interest rate on the T-Bills was 3.3% at the highest price, while it reached 2.28% at the lowest price, with an average of 2.29% in 2018. The CBE began offering T-Bills on 30 November 2011 with an average return of 3.87%. The central bank allows local banks and foreign institutions to buy using US dollars at a minimum of $100,000, or its multiples. The interest rate on the US dollar-denominated T-Bills is decided in accordance with a number of factors, most prominently US dollar liquidity in the market, alternative investment opportunities available for local and foreign financial institutions that invest in these bills, and the country's credit rating. Banks operating in the local market rely on such bills to invest their liquidity in dollars safely with the government, with an appropriate yield, in view of the lack of other investment opportunities for such liquidity. Exceptions include rarely available syndicated loans, or investment in global capital markets, with low yield and many risks associated.
