Government has failed to secure the entire amount targeted in its historic 20-year bond sale, which was to secure it about ¢450 million based on the Issuance Calendar from June to August.

Information available to JoyBusiness from some dealers, however, indicates that government got ¢162 million cedis from investors.

Expected interest to be paid on the bond Based on the bond results government is expected to pay about 20% as interest every year spread over 20 years. Payments to the Bank of Ghana’s accounts for this 20-year bond should be done by Monday, 26 August 2019. Why was the bond undersubscribed? It is not clear what might be the reason for the “under subscription”, however analysts may want to attribute it to developments in the US and maybe how the bond was marketed.  There are also possible concerns about the local currency’s outlook and some uncertainties with it going forward. Recently, long-dated bonds have also witnessed some challenges in terms of high investor interest and the targeted amount achieved. Finance Ministry on these bonds The Finance Minister Ken Ofori Atta had on several occasions told JoyBusiness that they are hoping to use these long-dated bonds to lengthen the time taken to settle its debt and hopes to raise cheaper debts to finance existing expensive ones. Government was also hoping to use these long-dated bonds to test the market.   According to the Issuance Calendar from June to August this year, government plans to issue a gross amount of GHȼ10,350.00 million. Some GH¢9,873.37 million of the amount is to rollover maturities and the remaining GH¢476.63 million is fresh issuance to meet government’s financing requirements. The issuance of the 10-Year, 15-Year and 20-Year bonds according to government are shelf offerings available to be issued over a period of time. Government says consistent with the Medium Term Development Strategy “we may announce other tap-ins/reopening of the existing instruments depending on market conditions.”