EGX Launches its new Bonds Trading System

Egyptian Exchange Posted

The Egyptian Exchange (EGX) developed a new system of trading government bonds in cooperation with the Central Bank of Egypt and the Ministry of Finance.  The new system provides pricing information, supply and demand information allowing increase in trading rates, which in turn help build a yield curve and develop new investment indicators and products.

This new system is the first technological development in the fixed income market since 2002, amid continuing demands from the market participants to stimulate it.

Dr. Mohammed Farid, Executive Chairman of EGX, said that the development of the new system was executed fully by EGX’s team after the study and analysis of all international regulations in this regard and in accordance with the needs and nature of the Egyptian market.

He added, that the previous trading system was just a trading screen to implement what was agreed between banks outside the system.  The current system has all the requirements of the trading of bonds documented, pointing out that what happened is a step followed to be completed by a continuous trading system as in the shares in the future.

The new system includes characteristics, the most important of which is the request for quotation RFQ allowing key customers to apply for bond pricing through the system, as well as quotation screen allowing any major customer to price or purchase the bond plus several options that facilitate the process of communication of customers within this market, rather than the previous one, a screen for the implementation of transactions agreed outside the trade reporting system.

These innovation and development steps are part of EGX’s management plan to provide an attractive market amid remarkable and exceptional activity in government bond trading, with average daily trading value ranging between EGP2.5 to EGP3 billion, as well as the great activity of corporate issues of bonds to diversify their sources of financing at EGX.