Government’s 1.5 billion cedi 3 year fixed rate bond issued yesterday 22nd October, 205 was undersubscribed.
Government raised less than the targeted 1.5 billion cedis it was looking for on the local market. It sold 995 million cedis of the three year notes with a yield 24.5 percent. Investors offered 1.3 billion cedis of bids with yields between 23 and 26 percent.
The auction comes days after government issued a 1 billion dollar Eurobond at a coupon rate of 10.75 percent.
The 3 year fixed rate bond which was available to both resident and non-resident investors was Ghana cedi denominated, and was issued at par.
Proceeds from the bond will be used to restructure Government of Ghana debt and for maturity settlement. Earlier the Group CEO of Ideal Finance, Dr Nii Kotei Dzani warned the auctioning of the bond will expose the economy to further risks. According to Dr. Nii Kotei Dzani government must as a matter of urgency desist from borrowing from the domestic market as that has contributed to the high unemployment in the country.
Speaking to Citi Business News Dr Nii Kotei Dzani said the government should rather concentrate on increasing revenue.
Source: Citifmonline.com