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JPMorgan, Citi Among Banks Selected for Egypt’s Dollar Bond Sale

JPMorgan, Citi Among Banks Selected for Egypt’s Dollar Bond Sale

(Bloomberg) -- Egypt said it picked five lenders, including JPMorgan Chase & Co. and Citigroup Inc., to manage new dollar bond issuance in the current fiscal year as borrowers in emerging markets reap benefits of more dovish policies by major central banks.

Standard Chartered Plc, BNP Paribas SA and Natixis SA were also selected, the Finance Ministry said Wednesday in a statement. It plans to launch the bond “in the coming period.”

Egypt is looking to take advantage of lower funding costs, pursuing a more diversified approach as it tries to reduce the burden for one of the Middle East’s most indebted countries. After issuing its first euro-denominated bonds last fiscal year, the government may borrow again in the common European currency while also considering Egypt’s first Panda, Samurai, sukuk and green bonds, according to Finance Minister Mohamed Maait.

JPMorgan, Citi Among Banks Selected for Egypt’s Dollar Bond Sale

The issuance is taking place to “benefit from improvements in current economic circumstances in emerging markets” and increasing demand from international investors for Egyptian bonds that lower the cost of financing, the Finance Ministry said.

Governments and companies in developing economies have raised a record $2.1 trillion through debt sales this year as they seized on investor appetite for yield. South Africa completed its biggest Eurobond sale last month.

Egypt’s government also said it has selected Al Tamimi & Co., which describes itself as the Middle East’s largest law firm, and global company Dechert LLP as legal advisers on the sale.

The North African nation, which has been enacting a sweeping economic reform program, was able to return to global bond markets in 2017. It raised $6.2 billion abroad in the fiscal year that ended in June and plans to borrow between $3 billion and $7 billion from international debt markets in the current fiscal year, Maait said in an interview this month.

Egypt has been upgraded by all three major rating companies since 2018. Its highest assessment is from Fitch Ratings, which has it at B+, four levels below investment-grade.

--With assistance from Netty Ismail and Lyubov Pronina.

To contact the reporter on this story: Mirette Magdy in Cairo at mmagdy1@bloomberg.net

To contact the editors responsible for this story: Alaa Shahine at asalha@bloomberg.net, Paul Abelsky, Amy Teibel

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