Govt’s 3-year bond fails to raise targeted amount.
Government’s three year bond which was sold today failed to raise the required amount.
The Bank of Ghana was looking forward to securing 630 million Ghana cedis worth of bids from investors but actually got 572 million cedis,
However the Bank of Ghana took just 502.10 million Ghana cedis.
Government will also be paying an interest of 23.47 percent.
For some analysts the interest rate being paid to investors might be interesting because in just about a month, the cost of the three year bond has gone up by almost 1 percent from 22.49 earlier this year to 23.47 percent.
Some market watchers were looking forward to this bond results to gauge government’s projection about the economy being on the path to recovery.
The level of investor interest and interest that will be paid on this bond go a long way to substantiate the investor confidence in the economy.
In April Government issued a three year bond which was also seriously undersubscribed.
It was hoping to raise some 400 million Ghana cedis, however government just got 168 million Ghana cedis.
But Bank of Ghana, which sold the bonds for the state took, 103 million cedis from investors and paid an interest 22.49 percent .
Government is expected to use proceeds of the bonds to refinance debts that are maturing. According to persons close to the sale of bond, almost all of the bonds sold were taken up by offshore investors.