EFTA Document EFTA01379404

22 December 2017 EM Currency Handbook 2018: Still Fuel in the Tank Regulatory framework and approach • Exchange rate policy and supervision is conducted by the Central Bank of Egypt (hupliwww cbe.orses), which is also responsible for implementing monetary policy. The main policy instruments of the CBE are the overnight deposit and lending rates; these define the bounds of the overnight inter-bank rate. The CBE interacts with the market through regular deposit auctions. • The Egyptian pound is convertible only for permitted underlying transactions, capital controls persist. Forwards are available via the NDF. • A withholding tax of 20% applies to government 1-bills; this can be reduced using double taxation treaties. EGP products NOTE: the figures below are approximations at the time of printing, these are exceptional times as we are still early days post the liberalization of the FX regime after a 5 year period of restriction. FX spot Avg. ticket size: Bid/ask spread: Avg. daily volume: USD 1-5-1mn EGP 0.15-0.30 USD 50 No auctions or intervention by CBE post free float thus far Trading hours: 08:00-02:00London (at time of printing, these are exceptional hours) (Interbank Spot trading is not available). Non deliverable FX forward Avg. ticket size: 5.0 mn Avg. daily volume: USD 30-60mn Liquid tenors: Bid/ask spread: <2Y EGP 0.04-0.06 Ref. source: NDF fixing reference Reuters <FEMF> 12:30pm Government T-bills and bonds Regulatory: transactions are now recorded electronically on a system which links the primary dealers, CBE and Cairo and Alexandria Stock Exchange (CASE) with the Misr Settlement, Clearing and Central Depository (MCSD). Most trading is OTC with only a few bonds quoted on CASE. A 15%-20% withholding tax (depending on home country tax rate) on T- bills was introduced in May 2008. This only applies to government T-bills issued from May 2008 onwards and does not affect payments on government bonds. Foreign investors face no restrictions on holding 1-bills or bonds but often use TRS or CLN for convenience. The market trades Sunday-Thursday. Avg. ticket size: USD 2-5mn Daily turnover: USD 50.70mn Bid/ask spread: T-bills: 30-50bp, 1-bonds: 50-100bps Tbill Issuance :Every Sunday - 3m and 9m Every Thursday - em and 1y All settlement takes place on Tuesdays. (note: working week in Egypt is Sunday to Thursday) Cut off for bid submission 10:00 CAI announcement after 1 pm CAI Cut off Mkt oonvondon FX settlement 4:00 CAI 1+2 Bills 1:30 CAI T+0 Deutsche Bank Securities Inc. Page 59 CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0076862 CONFIDENTIAL SDNY_GM_00223046 EFTA01379404