Government to roll out 25.3 billion cedis bond
Of the amount, 23.8 billion cedis is expected to be used to rollover forecast maturities with the remaining amount of 1.4 billion cedis being fresh issuance to meet government’s financing requirements.
A statement from the Bank of Ghana said, “In accordance with the Government’s MTDS, the Bank of Ghana, on behalf of the Ministry of Finance, announces for the information of Primary Dealers, Banks, prospective investors in the domestic securities market and the general public, the revised Issuance Calendar for Government of Ghana Securities for August to December 2016.”
It also indicated that government would consider accepting a reasonable amount above the target to build buffers which would be used to reduce borrowing.
Government explained it aims at continuing the objective of lengthening its debt maturity profile by reducing short-term borrowing, while issuing the 91 and the 182-day bonds weekly.
Per the new calendar, 60 million cedis will be issued every 2 weeks for the 1-Year Note, through the primary auction.
Settlement will occur on the first and third Mondays of each month.
Also, the 2-Year Note will be issued monthly through the primary auction with settlement occurring on the second Monday of each month.
While the 3, 5 and 10-Year issues will be done through the book-building method, with settlement on the last Monday of each month.
An amount of GH¢400 million for the 5-Year Bond will be raised this month through reopening of the existing 5-year Bond at a coupon rate of 24.75% with maturity at 19th July 2021, and settlement on 29th August, 2016.
Meanwhile the statement forecasts that the 1 billion cedi 5-Year Bond for scheduled for next month, may be issued partly in a United States Dollar equivalent Bond, with settlement on 12th and 26th September, 2016 for the cedi and US Dollar Bond respectively.