Egypt

Egypt is entering the final stages of preparation for its planned bond issue and will meet investors in Dubai next week, leading to suggestions that the sovereign will issue in sukuk format.

Rating: A1/A+/A+

Turkish bank, Albaraka Turk is hoping to update its old-style tier two sukuk debt to make it eligible as capital under Basel III and has asked investors to approve the inclusion of a point of non-viability (PONV) clause.

Egyptian investment bank EFG Hermes is expanding its frontier markets division, and has appointed a new CEO who joins from Exotix Africa LLP.

In this round-up, China saw another sizeable drop to its foreign exchange reserves in November, the Shenzhen Connect saw subdued trading activity in its first four days, and Egypt signed its first currency swap line with China. Plus, a recap of our coverage this week.

Though Egypt is reeling from the central bank’s action to float its currency last month two Egyptian borrowers are in the market for hard currency loans this week, but unsecured corporate loans will be slower to come, said bankers.

The Egyptian subsidiary of Abu Dhabi telecoms firm Etisalat is raising a $278m loan described as having “UAE pricing” because — despite the currency risks involved in Egyptian loans — the deal is secured by the borrower’s offshore foreign currency revenues, according to bankers.

Caa1 rated Banque Misr is syndicating a loan with a longer than usual tenor of five years, though a guarantee from the Egyptian central bank will help drive demand, according to two bankers away from the deal.

In the midst of an aggressive EM bond rout, Egypt was given a much needed boost after the International Monetary Fund approved a three year $12bn loan on Friday.

Egypt’s return to the Eurobond market could be postponed until next year after its finance ministry raised a further $2bn of funding from international banks.

In this round-up: RMB indices record a stabilisation of the currency against the trade-weighted baskets, Hong Kong RMB deposits increase nearly 2% in September, and the China cross-border interbank payment system (CIPS) expands to 400 indirect participants. Plus, a recap of our top stories this week.

Fitch has removed Afreximbank from rating watch negative, partly because of its “excellent” risk mitigants, as the development bank continues to arrange a loan of at least $750m.