View Full Version : Gov’t to receive cash from 5-year-bond

13th December 2011, 01:19 AM
The Government of Ghana is expected to receive funds from last week’s five-year bond issue today.

The bond which will be used to finance on-going road projects and maturing debts was slightly oversubscribed.

Whilst the government was seeking to raise GHS200 million the interested investors were willing to buy as much as GHS214 million.

It however took only GHS196 million and refunded the rest to investors.

Last week’s bond issue saw local investors take up the entire GHS200 million five year papers.

This appears to be the first time in a while that local investors have taken up the entire government papers issued by the Bank of Ghana.

Explaining what must have accounted for this, Appiah Twene Mensah, Head of Treasury at Access Bank Ghana said the foreign investors factored political and risk and currency depreciation and, therefore, made offers that were not acceptable to the government.

“We have seen in general terms most of these foreign investors are backing out of emerging markets, most importantly African markets partly because of the Euro-zone crisis; partly because they have found another alternative means of applying their capital,” he noted.

The five-year bond will have a yield of almost 16 percent for investors - also one of the highest in a while now.