- Treasury Bills Drive GH¢1.09bn GFIM Turnover as Investors Favour Liquidity Over Long-Term Risk
Trading on the Ghana Fixed Income Market reached GH¢1.09bn on Thursday, September 24, with investors overwhelmingly favouring Treasury bills and restructured government bonds over conventional and corporate debt.
Data contained in the GFIM trading report show that Treasury bills accounted for GH¢750.43m, or 69.1 per cent, of the day’s total volume. Domestic Debt Exchange Programme bonds contributed another GH¢251.02m, equivalent to 23.1 per cent.
Together, those two categories represented more than 92 per cent of all securities traded, underlining the degree to which Ghana’s secondary debt market remains concentrated around sovereign instruments.
Sell-and-buy-back transactions involving government bonds financing arrangements commonly used by financial institutions to manage short-term liquidity contributed GH¢77.83m, or 7.2 per cent.
By contrast, newly issued government bonds recorded turnover of just GH¢2.45m, while corporate bond trades amounted to GH¢3.58m. Old government securities contributed only GH¢39,477.
The figures offer a revealing snapshot of investor behaviour. Ghana’s fixed-income market is active in headline terms, but the underlying transactions suggest that liquidity, maturity management and capital preservation continue to matter more than a broad return to long-term risk-taking.
The most striking feature of Thursday’s session was the concentration of Treasury bill activity in 364-day instruments.
Of the GH¢750.43m in bill turnover, 364-day securities accounted for GH¢723.57m, approximately 96.4 per cent. The 91-day bill segment recorded GH¢12.74m, while 182-day bills attracted GH¢14.13m.
The largest individual transaction was in the Treasury bill maturing on June 21, 2027. The instrument recorded GH¢371.88m across six trades, representing almost half of all Treasury bill turnover and more than a third of the entire market’s activity.
Its closing yield stood at 8.79 per cent, marginally below an opening level of 8.80 per cent.
A second 364-day instrument, maturing on May 10, 2027, recorded a single GH¢100m transaction at a closing yield of 7.66 per cent. Another bill maturing on August 2, 2027 attracted GH¢78.09m across 16 transactions, closing at a yield of 9.28 per cent.
The dominance of 364-day bills indicates that investors are willing to move slightly beyond the shortest end of the yield curve, but not necessarily into conventional medium- and long-term government bonds.
This is an important distinction. Appetite for one-year government paper can reflect improving confidence in near-term macroeconomic stability without implying that investors are fully comfortable with Ghana’s longer-term fiscal and refinancing risks.
In effect, investors appear prepared to lend to the government for a year, particularly where the yields are attractive and the instruments are liquid. They remain more selective about committing funds for several years.
DDEP bonds were the second-largest source of market turnover, with GH¢251.02m traded through nine transactions.
Two securities dominated the segment. The bond maturing in February 2031 recorded GH¢100m across two trades and closed at a yield of 14 per cent, down from an opening yield of 14.28 per cent. Its end-of-day price was 83.80, well below par.
The February 2032 bond also registered GH¢100m in a single transaction. Its yield increased from 14 per cent to 14.35 per cent, while its closing price stood at 80.70.
A 2034 DDEP bond attracted GH¢23.97m and closed at a yield of 14.9 per cent and a price of 75.81. The 2036 security recorded GH¢3.02m, ending the session with a yield of 15.5 per cent and a price of 71.75.
These discounts carry a deeper message than turnover alone. The market is providing liquidity for the restructured securities, but investors continue to demand significant compensation for duration and sovereign credit risk.
Prices falling below par as maturities lengthen show that the market is applying a substantial discount to distant government cash flows. The activity therefore represents a recovery in tradability, not necessarily a complete recovery in confidence.
The yield movements were also mixed. The 2031 bond recorded a fall in yield, suggesting stronger demand, while yields on the 2032, 2034 and 2036 securities rose. Such divergence points to investors differentiating between maturities instead of treating all restructured bonds as a uniform asset class.
Activity in the government’s newer conventional bonds was limited to GH¢2.45m across three transactions.
A 12 per cent bond maturing in September 2030 accounted for GH¢2.44m of that amount. Its closing yield rose to 12.02 per cent from 11.5 per cent, while its price ended at 99.92.
A 12.5 per cent bond maturing in March 2033 recorded only GH¢9,319 in turnover. Its yield declined to 12.17 per cent from 12.51 per cent, and it closed above par at 101.45.
The small volume suggests that the market for conventional longer-term securities remains comparatively illiquid. It may also reflect limited free-floating supply, investors holding securities to maturity, or continued caution towards duration following Ghana’s domestic debt restructuring.
Old government bonds were even less active. The only traded instrument was a 19 per cent security maturing on November 2, 2026, which recorded GH¢39,477 across three trades.
Corporate bond turnover stood at GH¢3.58m, representing only 0.33 per cent of total market activity.
All recorded corporate trades were in securities issued by Consolidated Bank Ghana. A 13 per cent bond maturing in August 2027 accounted for GH¢2.05m across three trades, closing at a price of 100.56. A similar bond maturing in August 2028 recorded GH¢1.53mn in a single transaction and closed at 103.38.
The weakness of corporate bond trading is one of the more consequential features of the data.
A functioning fixed-income market should do more than provide a venue for government borrowing. It should enable banks, infrastructure companies and other businesses to raise long-term capital outside the traditional banking system.
Yet with sovereign securities absorbing nearly all secondary-market liquidity, corporate issuers face a familiar problem: government paper offers scale, recognised credit structures and greater liquidity, making it difficult for private-sector debt to compete.
That concentration risks reinforcing the sovereign-bank nexus Ghana has been attempting to weaken. Banks and institutional investors remain closely tied to government securities, while businesses depend heavily on comparatively expensive bank credit.
The GH¢1.09bn headline is encouraging because it demonstrates that Ghana’s fixed-income market can generate substantial daily activity. But the composition of that turnover is more instructive than the aggregate number.
The report identifies the June 2027 Treasury bill as the “largest volume traded” in the bill segment, while the February 2031 DDEP bond led activity among restructured securities. Those two instruments alone accounted for GH¢471.88m about 43.5 per cent of total GFIM turnover.
Such concentration means one should be cautious about reading the headline volume as evidence of broad market depth.
The emerging picture is of a market gradually rebuilding its capacity to price and trade government risk, but doing so unevenly. Investors are embracing liquid Treasury bills, trading selected restructured bonds at significant discounts and largely avoiding the broader corporate market.
For policymakers, the challenge is no longer simply to restore trading after the domestic debt exchange. It is to build a yield curve that investors trust across maturities, improve secondary-market liquidity and create enough room for corporate debt to develop.
Until that happens, Ghana may possess an active fixed-income market without yet having a fully diversified one.
