Egypt studies issuing Sukuk during Q1 of 2020: Omran

CAIRO - 20 November 2019: The Financial Regulatory Authority (FRA) studies Sukuk issuance, which are expectedto be offered during the first quarter of 2020, FRA Head Mohamed Omran Said Wednesday.

Omran clarified during a conference to announce the issuance of the first short-term securitization for the payment of Premium Card that the biggest challenge is offering green bonds, referring that it's related to SDG of sustainable growth.

He further noted that FR seeks to have a green-bond issuance during 2020.

He explained that this step came as a result of the amendments of the Capital Market Law no. 17 of 2018, which were based on three axes, including short-term securitization, green bonds, and Sukuk.

Omran added on the sidelines of the press conference, that the authority seeks to promote such markets, especially short-term debt instruments, as it seeks to finance the capital cycle as a whole, whether through free capital or public capital, which is clear in the law of leasing, finance and collection, explaining that the duration of trading of such instruments starts from 7 days to a maximum of 2 years.

The conference was attended by Founder and CEO of Premium International for Credit Services Paul Antaki, Co-Head of EFG Hermes' Investment Banking Division (IBD) Mostafa Gas, and CEO of Arab African International Bank Sherif Elwy.

In 2018, Egypt’s Parliament ratified the amendments of the Capital Market Law that aims to increase competitiveness and create a more inclusive economic climate. These amendments included offering more protection to minority stakeholders, especially in acquisition cases. It gives the power to the Egyptian exchange to lower registration fees for small businesses to encourage small companies to compete in the market.

The law also introduces Sukuks to the exchange market. Sukuks are bonds that are compliant with the Sharia law and put the foundation for establishing a union for securities companies.