Last Update 20:36
Saturday, 22 February 2020

Egypt government to issue LE1 bn in zero coupon bonds

Ministry of Finance official confirms government plan to diversify debt portfolio through issue of zero coupon bonds starting 17 September

Ahram Online, Tuesday 10 Sep 2013
Share/Bookmark
Views: 1192
Share/Bookmark
Views: 1192

The Egyptian government plans to issue LE1 billion worth of zero coupon bonds starting 17 September, a Ministry of Finance official told Ahram Online Tuesday.

The bonds will carry a tenor of 18 months, as the government tries to diversify its debt portfolio, the official, who requested not to be named, said.

A zero coupon bond is an interest-free debt security, issued at a discount rate, which will render profit at maturity when the bond is redeemed.

The issuing of the bonds will take place at the Egyptian stock exchange, and will be traded in the secondary market through the screens of primary dealers.

A statement by the Ministry of Finance on Monday said that the bonds were originally planned for last July, but political turbulence delayed them, initially until 10 September, and then they were subject to further delays as a result of technical problems.

This measure is part of a government plan to diversify financial resources and widen the base of investors.

Egypt’s total domestic debt grew rapidly over the past few years, reaching LE1.5 trillion in March 2013, 82 percent of Gross Domestic Product (GDP), according to Central Bank of Egypt data.

Debt servicing is forecast to grow by at least 31 percent in the current fiscal year, to reach LE182 billion in the proposed state budget, which is 26 percent of total public expenditure.

Search Keywords:
Short link:

 

Latest

© 2010 Ahram Online.