The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.

All material subject to strictly enforced copyright laws. © 2022 Euromoney, a part of the Euromoney Institutional Investor PLC.

Egypt: Debt needs derivatives

Synthetic bond is a precursor to bonds in Egyptian pounds.

Egypt will have to develop an effective derivatives market before international issuers can sell bonds denominated in Egyptian pounds.

This is the conclusion of David Clark, head of funding (non-euro) at the European Investment Bank, after the bank’s first synthetic Egyptian pound issue last month, which it sees as a stepping stone on the way to locally denominated debt.

The EIB sold a two-year E£300 million ($53 million) synthetic Egyptian pound bond that carries a coupon of 6.5%, which is payable in euros based on a formula linked to the euro/Egyptian pound rate.

The EIB hopes to follow its synthetic issue with bonds denominated in Egyptian pounds later this year. “The bank is actively researching the domestic Egyptian market and sees this as a precursor to issuance in the domestic market,” he says.

The EIB has been working closely with the Egyptian authorities in connection with the establishment of local-currency issuance. Many of the market’s regulations are not compatible with international investment. “Some significant developments have already been seen but one of the things holding up the market’s development is the absence of an effective derivatives market,” Clark says.

The new issuance forms part of the EIB’s objective of building a presence in selected developing capital markets, particularly those of the EU’s partner countries in the Mediterranean region that fall under the EIB’s facility for Euro-Mediterranean Investment and Partnership.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree