Egypt converts Qatari $2.5bln to support crisis

Egypt has converted $2.5 billion that Qatar lent it in December into 18-month notes and is working to convert another $3 billion lent this month into three-year bonds, Egypt's central bank governor was quoted on Thursday as saying.

Qatar provided the funds as deposits with the central bank to help Egypt control its currency crisis and shore up its balance of payments, weakened by political and economic turmoil since a popular uprising ousted Hosni Mubarak in February 2011.

Since the uprising, Egypt has run through more than $20 billion in reserves, borrowed billions more from abroad and delayed payments to oil companies to support its currency.

The 18-month notes, which mature on Nov. 28, 2014, will pay 4.25 percent annual interest, according to data on the website of the Irish Stock Exchange where they are listed.

Analysts said the pricing brought the notes close to international levels, indicating that Egypt's main financial backer was not prepared to lend at the concessionary rates offered by some international agencies.

Qatar has lent or given Cairo $7.5 billion since Mohamed Mursi of the Muslim Brotherhood was elected president last June.

Egypt has been seeking a $4.8 billion loan from the International Monetary Agency that would have an interest rate of 1.1 percent, but it has balked at adopting the economic austerity measures the IMF would demand in return.