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Pedestrians use the stairs outside of Egypt's central bank in Cairo, Egypt.(bloomberg)
(Bloomberg) -- Egypt struck a deal to get $3.8 billion in new financing from an international consortium that includes Deutsche Bank AG and HSBC Bank Plc to boost its foreign-currency stockpile at a time when an emerging-market selloff is spooking investors.
The accord replaces a one-year, $3.1 billion agreement that will expire next month, and aims at “extending the duration” of Egypt’s debt structure, the central bank said in a statement on Thursday. The repurchase transaction was struck with lenders that also include Citigroup Global Markets Limited, Credit Suisse Group AG, JPMorgan Securities Plc and First Abu Dhabi Bank PJSC. It takes effect on Nov. 19 and will carry a final maturity of 4 1/2 years.
Egypt’s external debt has more than doubled to nearly $90 billion over the past two years, with officials seeking foreign funding to lower the government’s cost of borrowing and shore up currency reserves. The effort began in 2016 when Egypt floated the pound to end a dollar crunch, helping secure a $12 billion loan deal with the International Monetary Fund.
The deal also follows the start of a non-deal bond roadshow in Asia including China, Malaysia, Singapore and Korea. Finance Minister Mohamed Maait has said the country plans to sell $5 billion in international bonds in 2018 or the beginning of 2019.
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