Government on Thursday made a tap issue re-opening of the first-ever six year treasury bond which was issued in the first quarter of 2019, with maturity in January 2025.
An outstanding amount of GHc 370.3 million in bonds issued is expected to be raised from this particular long-term bond re-issuance.
This issuance replaced the 5-year treasury bond issuance intended for February 2019, as stated in the Ministry of Finance’s Issuance Calendar for first quarter 2019.
The bonds issued each have a face value of GHc 1, with a minimum subscription of GHc 50,000 and multiples of GHc 1,000 thereafter. The offer was opened to both local and foreign investors.
However, according to the issuance calendar for the quarter, the 5-Year Bond which has been replaced, would have been issued subject to market conditions and at the time of issuance, the market conditions were not particularly good..
All successful bids for the re-issuance will clear at a single level discretionary allocation at the single clearing level in the event of over-subscription.
The six-year bonds are being issued through Barclays Bank, Databank, Stanbic Bank, Fidelity Bank and IC Securities acting as book runners for government.
Notwithstanding the tap issue, for the second quarter of 2019, government plans of raising a total GHc 12,100 million from the domestic market, representing a 19.2 percent increase over the amount targeted in the first quarter of GHc 11,250 million.
Of the total gross amount, GHc 11,533.94 million is to rollover maturities and the remaining GHc 566.06 million is fresh issuance to meet government’s financing requirements.
Medium-Term Debt Management Strategy
Under the 2019 debt strategy, which is a continuation of the strategy implemented in 2018, government has issued an annual borrowing and recovery plan for 2019 in line with section 60 (5) of the Public Financial Management (PFM) Law.
By Joshua W. Amlanu