Government needs to exclude individual bondholders in debt exchange after deal with banks
The Forum said the government should absolutely exempt Individual Bondholders, including individuals, who hold eligible bonds under the Domestic Debt Exchange Programme (DDEP) through Collective Investment Schemes.
A statement issued in Accra and signed by Mr Senyo Hosi, the Convener, congratulated the government and the Ghana Association of Banks (GAB) for reaching a deal towards the reengineering of the economy.
The government and the GAB have made significant progress on the terms for the participation of Banks in the Programme.
The progress encompassed an agreement to pay five per cent coupon for 2023 and a single coupon rate for each of the 12 bonds, resulting in an effective coupon rate of nine per cent.
There is also clarity on the operational framework and terms of access to the Ghana Financial Stability Fund.
“We observe with delight government’s various incentives provided to the banks which among others include the Bank of Ghana’s forbearances and favourable revisions to the prudential rules including reductions in the Capital Adequacy Ratio and the Cash Reserve Requirements,” it said.
The statement said to make it much more functional, the government had indicated it would be providing a financial stability fund to support the viability of the banks.
It said with the banks onboarding the Programme, the government was set to reach its 80 per cent target.
This development reaffirmed the need for the government to exclude Individual Bondholders, including individuals and Collective Investment Schemes (CIS), who account for less than 1per cent of the eligible bonds.
“Unlike the banks and other institutions who are set to benefit from various regulatory incentives, Individual Bondholders have no fall back nor incentives and will be condemned to shackled penury,” it added.
It said the Forum maintained its position that cutting the government expenditure and optimizing revenue was the sure winner for Ghana in these difficult times.