GHS 2.4bn coupon payment testament of Gov’t’s success, credibility of debt exchange operations – Dep. Finance Minister
The Deputy Finance Minister, Dr. John Kumah, has highlighted the government’s dedication to the Domestic Debt Exchange Programme (DDEP) following the successful settlement of the first coupon payment for affected bonds. Dr. Kumah expressed his views during an interview with Citi FM in Accra, emphasizing the significance of this accomplishment in solidifying the government’s commitment to the program’s success.
Dr. Kumah remarked, “This is a confirmation of the government’s commitment to the continued success and credibility of the domestic debt operations that the government undertook in the early part of the year.” He went on to underscore the positive impact of this action on market confidence, affirming that the government will steadfastly uphold its responsibilities concerning debt operations and restructuring.
Assuring stakeholders and bondholders, Dr. Kumah reiterated the government’s pledge to meet its obligations for forthcoming coupon payments. “Let me assure you and to assure all bondholders that government is committed to its obligation and as soon as all coupons are due, government will respect its obligations,” he affirmed.
The Ministry of Finance initiated the settlement process for the first coupon payment of bonds affected by the domestic debt exchange program. This round of matured coupons, totaling GH¢2.4 billion, has already been cleared for settlement.
The Domestic Debt Exchange Programme was introduced in 2022 with the goal of restructuring Ghana’s unsustainable debt load. Eligible bondholders were presented with the option to swap their old bonds for new ones with extended maturities and reduced interest rates. The agreed coupon payment for the affected bonds was set at 5%, lower than the rates on the old bonds.
Initially, market concerns lingered regarding the government’s ability to fulfill the 5% coupon payment. The Ministry of Finance has assuaged these uncertainties, highlighting that the successful coupon settlement affirms the government’s commitment to the ongoing success and credibility of the country’s domestic debt operations.
Furthermore, the Ministry noted that the new bonds issued under the DDEP now command a prominent position within the domestic bond market, underscoring the program’s transformative influence on the financial landscape.