Gov't targets up to $100 million for historic domestic dollar bond

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Government is looking at raising up to $100 million from its historic domestic dollar bond.

The sale of the first dollar-denominated bond for local investors begun on October 3 and is expected to close on October 13, 2016.

Sources say government is looking at paying investors an interest of 5.5 to 6.5 percent on the 2-year bond.

However, some analysts are of the view that, government wants to tap into the huge dollar deposits in the bank system and also the favourable interest that it will be paying compared to borrowing outside.

This could come through the Eurobond, which is likely to pay between 8 to about 11 percent and about 21 percent on cedi denominated bonds.

The deal is being managed by three financial institutions; Barclays, Stanbic Bank and finance house SAS.

Some analysts are of the view that issuing dollar-denominated bonds just for domestic investors could bring some pressure on the cedi.

This is because some investors could be forced to change their cedis into dollars to participate in the bond.

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