Ghana to issue Gh¢400m 7-yr domestic bond

The Bank of Ghana has served notice a Gh¢ 400 million, seven-year domestic bond will be issued in April.

The move is to use longer-term maturities to restructure the central bank’s rising debt.

According to the BoG’s issuance calendar, a total of 25.4 billion cedis ($7.88 billion) in domestic securities is expected to be raised before July.

Ghana issued its debut seven-year domestic bond in August 2013 and held a similar auction three months later with an 18 percent yield.

The bank will also issue five-year bonds in March and June to raise 440 million cedis each, and three-year paper worth 630 million cedis each in February and May to roll over maturing debts.

The government did not issue a seven-year bond last year as it wanted to avoid a spike in yields following a slump in the local currency.

“The Treasury Bills and Notes (91-Day Treasury Bills – 2-Year Notes) are short term debt securities. Issuance decisions will be made weekly depending on Government’s projected daily cash position for the week ahead. It is envisaged to issue at least GH¢880 Million of Treasury Bills and Notes weekly at all times to support government liquidity requirements which will include the redemption/rollover of maturing securities for the week,” the issuance notice signed by Caroline Otoo, Secretary of the BoG said.

The Mahama-led administration is currently before the International Monetary Fund for a bailout to salvage the ailing economy.