Government has successfully completed the issuance of a five year bond to raise money to fund a number of infrastructural projects.
This is the second five year bond issued this year and the fourth medium to long term bond issued this year.
Government proposed to raise an amount of GH¢300 million, however, the auction recorded inflows of GH¢1,070 million which was oversubscribed by 257%.
Government accepted 898 million cedis at a coupon rate of 23%. This represents a decrease of 3% from the coupon of the last five year issue.
It is significant to note that about 80% of the bids came from foreign investors.An elated Dr Kwabena Duffuor, Minister for Finance and Economic Planning said this clearly demonstrates the confidence that investors have in the Ghanaian economy. The huge foreign investor participation in the auction is an indication of the strong appetite that foreign investors have for Ghanaian risk.
Government raised the bond to primarily pay off some outstanding commitments and given the over subscription, the additional funds accepted above GH¢300 million would be used to restructure the domestic debts by lengthening the maturity profile in line with the debt management objectives.
Source: Lorrencia Adam/Citifmonline.com/Ghana
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