May 7, 2020 / 6:46 PM / 18 days ago

UPDATE 1-Egypt's foreign reserves fall to $37.037 bln end-April - central bank

(Adds additional details, background)

CAIRO, May 7 (Reuters) - Egypt’s foreign reserves dropped by a further $3.07 billion in April as investors spooked by the coronavirus pulled cash from emerging markets, the central bank said on Thursday, a drain on funds that has pushed Egypt to seek help from the International Monetary Fund (IMF).

Reserves fell to $37.037 billion at the end of April from $40.108 billion at the end of March after having fallen by $5.4 billion in March.

The net foreign assets of the country’s banks plummeted by 162.12 billion Egyptian pounds ($10.33 billion) in March, according to central bank figures.

Egypt said on April 26 it was seeking IMF financial support in the form of a Rapid Financing Instrument (RFI) and its Stand-By Arrangement (SBA), both designed for countries facing urgent or potential balance of payments problems.

The IMF’s executive board is scheduled to consider both requests on Monday. Egypt can borrow as much as $2.78 billion under the RFI and about $4 billion per year under the SBA, according to analysts and information on the IMF website.

“Global markets at large remain under pressure due to the persistence of the COVID-19 pandemic which continues to drive portfolio flow reversals from emerging markets,” the central bank said in a statement on Thursday.

Egypt drew on its foreign reserves in April to repay a Eurobond worth $1 billion and $600 million in other external obligations, as well as to cover the imports of strategic goods, the bank said.

Foreign investors in March sold the equivalent of 149.3 billion Egyptian pounds ($9.5 billion) of Egyptian pound treasury bills, more than half of their holdings, data published on Thursday on the central bank website showed.

Foreign currency inflows have been hurt by a virtual halt in tourism from mid-March, while remittances from workers outside of Egypt have also come under threat.

Tourism earned Egypt $13 billion and remittances $26.8 billion in 2019, according to central bank figures. ($1 = 15.7000 Egyptian pounds) (Reporting by Nadine Awadalla, Writing by Patrick Werr, Editing by Gareth Jones and Chizu Nomiyama)

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