Egypt regulator pins bond market hopes on central bank

Egyptian authorities are eager to develop an active bond market but are counting on the central bank to ensure the participation of commercial banks, the head of the country's financial markets regulator said.

Encouraging trade in bonds is a key part of the Egyptian Financial Supervisory Authority's (EFSA) plan to repair the capital markets after three years of political and economic instability following the revolution of 2011.

Trade in government bonds could make it easier to fund the state budget deficit, while more corporate issuance would give companies an important channel to raise funds for investment. At present, over 90 percent of bond issues in Egypt are by the government.

Bonds were supposed to start trading on the Egyptian Exchange in the third quarter of this year, but that has not happened.