Govt re-opens DDEP to increase participation – Finance Ministry

A statement issued by the Finance Ministry in Accra on Wednesday and copied to the Ghanaian Times said government was aware that a number of holders of eligible bonds did not participate in the February 2023 Exchange on time, and as a result were left with their holdings of eligible bonds.

It said mindful of that de­velopment, the government was proceeding with an administrative re-opening of the February 2023 Exchange, the statement said.

“We believe that there is value for bondholders to participate in this invitation. Indeed, the New Bonds (which will include the new tranches) are expected to be more liquid than the eligible bonds, considering the larger investment base and the benchmark size of the new bonds. In addition, the government could under certain circumstances prioritise payments on the new bonds over payment on the eligible bonds. Participa­tion in this administrative reopen­ing would also further improve the cash flow position of the government and further support debt sustainability,” the statement said.

The statement noted govern­ment was inviting holders of the domestic notes and bonds of the Republic of Ghana, E.S.L.A. Plc and Daakye Trust Plc, to tender their holdings of the eligible bonds in exchange for a package of new tranches.

The Ministry of Finance explained that the terms of that invitation were identical to the terms of the February 2023 Exchange.

The government last year, as part of the $3-billion three year Extended Credit Facility Pro­gramme with the International Monetary Fund (IMF), embarked on a DDEP programme as part of measures to ensure debt sus­tainability and restore macroeco­nomic stability.

The statement said pursuant to the February 2023 Exchange, the government accepted ten­ders from a significant majority of the holders of the securities which were within the scope of the February 2023 Exchange (i.e., approximately, 85 per cent in respect of the relevant domestic Cede denominated treasury notes and bonds, 77 per cent in respect of the bonds issued by E.S.L.A Plc, and 94 per cent in respect of the bonds issued by Daakye Trust Plc) and issued 16 series of the new bonds to persons whose tenders were accepted.

The Finance Ministry said the invitation was available only to registered holders of eligible bonds that were not Pension Funds.