By: Rebecca Ekpe
A Press release from the Ministry of Finance dated Tuesday, January 31, 2023 has indicated that the Government has extended the deadline for the Domestic Debt Exchange Programme (DDEP) to February 7, 2023.
A new settlement date of Tuesday, February 14, 2023 is expected to be made public and confirmed via the new Exchange Memorandum.
Original deadline for the Domestic Debt Exchange Programme expired at 4 pm today, January 31, 2023.
According to the Finance Ministry, there has been significant progress with all stakeholders, including financial sector industry Associations and representative groups of individual bondholders, with respect to their participation in the Programme.”
After a series of meetings, after earlier agitations, the Finance Ministry announced updates.
“Based on the agreement reached with the Ghana Association of Banks (GAB), Ghana Insurers Association (GIA), and the Ghana Securities Industry Association (GSIA), the new terms of the exchange have been accepted’’.
“A revised and final Exchange Memorandum will be released by Thursday, February 2, 2023’’. It communicated.
Meanwhile, the following terms, according to the Ministry of Finance were reached after engagements with the representative groups of individual bondholders.
The new Exchange Memorandum:
a. An affirmation that all individual bondholders are free not to participate;
b. However, upon a successful DDEP there will be very few of the ‘old bonds’ in circulation, and likely limit its tradability;
c. In this regard, the Government is pleased to make available the following alternative offer to encourage all individual bondholders to participate in the Exchange:
i. All individual bondholders who are below the age of 59 years will be offered instruments with a maximum maturity of 5 years, instead of 12 years, and a 10% coupon rate;
ii. All retirees (including those retiring in 2023) will be offered instruments with a maximum maturity of 5 years, instead of 12 years, and a 15% coupon rate.
Furthermore, discussions are being finalized with Organized Labour and Pension Fund Trustees, on a separate arrangement in accordance with the MoU with Organized Labour on December 22, last year and in line with the government’s Debt Management Programme.
“With this, the Government encourages all stakeholders to participate in the DDEP, an essential step towards meeting our debt sustainability targets and restoring macroeconomic stability and economic growth.
“These developments have necessitated the final extension of the deadline from January 31, 2023, to Tuesday, February 7, 2023, and a new settlement date of Tuesday, February 14, 2023, that will be confirmed via the new Exchange Memorandum,” the Finance Ministry noted.
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