LE 250 million from the Ministry of Finance to Misr Clearing to step in when necessary to support the market

Investment Funds reduce minimum level for buying their documents in response to youth c...

  LE 250 million from the Ministry of Finance to Misr Clearing to step in when necessary to support the market Investment Funds reduce minimum level for buying their documents in response to youth call to support the Egyptian economy The Ministry of Finance has received numerous inquiries about the means to support the Egyptian Stock Exchange (ESE), especially as it is due to reopen soon this week, according to an official source of the ministry. The government welcomes this concern on the part of the citizens. However, it emphasises that there are more than one mechanism which can be used to support the Stock Exchange, such as buying shares and stocks through brokerage companies registered with the ESE. These companies handle buying and selling transactions of securities on behalf of the investors for a simple commission. This only requires obtaining the code number for the investor which is also acquired for the investor through these companies. Addresses and all other data concerning these companies are available on the website of ESE (www.egyptse.com), in addition to different Internet sites interested in investment in securities, the source added. These companies, the source asserts, work under the strict control of both the Egyptian Financial Supervising Authority (EFSA) and the Stock Exchange administration. Other support mechanisms include buying documents of the investment funds of the commercial or private banks operating in Egypt. The Egyptian market is served currently by 34 investment funds, most of which have already lowered the minimum level of buying in response to the youth call to support the Egyptian economy and Stock Exchange. This allows the public to buy a single document for less than LE 100. The Egyptian Central Bank has already opened an account (number 25/1/2011) to receive donations from citizens inside the country and abroad to support the Egyptian economy. The accumulated sums will be used to subsidize various economic sectors including the Stock Exchange. The government has taken all the necessary measures to support and protect the ESE and small investors. Several mechanisms will be used to face any severe fluctuations that may disrupt dealings immediately after reopening, most important among which is that the ministry allocated LE 250 million to Misr Clearing, Settlement and Central Recording Company to enable it to intervene to support the market, the source added. Egyptian economy performance indicators have recently been reassuring, the ministry’s source asserted. Moreover, the Egyptian economy maintained its ranking by international standards, amid expectations that the ranking is will rise in the coming years. Performance of deposit certificates of the Egyptian shares abroad is good with no severe fluctuations; the certificates have even managed in such a way as to regain a large part of their losses which occurred at onset of the recent events. The source expects that dealings in the ESE will reflect the state of trust and optimism which surround the future of the Egyptian economy as an impact of the recent democratic developments. (Source: Ministry of Finance)