Gov’t to issue fresh sukuk to pay off maturing 10-year bonds: The Finance Ministry could complete an issuance of international sukuk before the second half of June in order to repay some USD 1.5 bn of maturing 10-year bonds issued back in June 2015, a government source told EnterpriseAM.

The details: The ministry is currently coordinating with banks advising on the issuance to assess the feasibility of launching the issuance before the debt maturity date — especially as the repayment coincides with Eid Al Adha, which may require moving the payment to the first week of June, our source said. Foreign obligations for the public treasury in the fourth quarter of the current fiscal year amount to USD 3.1 bn, including debt repayments and maturing bonds.

We saw this coming: A government source told EnterpriseAM earlier this month that the Finance Ministry is aiming to complete an issuance of sukuk before the end of FY 2024-2025, with another government source telling us that the government is currently waiting on the most opportune time to complete the issuance, and said that this could happen as early as this month.

Remember: Finance Minister Ahmed Kouchouk said last month that Egypt is planning on issuing USD 2 bn in sukuk in 2025 through multiple offerings, with the government already having appointed banks for the issuance. The banks involved in the issuance are the same ones that managed our maiden sukuk issuance in February 2023 — HSBC and Citibank, along with Dubai Islamic Bank, First Abu Dhabi Bank, and Abu Dhabi Islamic Bank — a senior government source told EnterprimeAM at the time. Egypt also has a registered program with the London Stock Exchange worth USD 5 bn for issuing sovereign sukuk.

More to come: The government has been holding meetings with investors interested in subscribing to new sukuk issuances, our sources said.

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