Ghana’s government decided not to proceed with a planned 5-year local currency bond slated for final pricing on Thursday due to unfavourable market conditions, according to a note to investors seen by Reuters.
The Finance Ministry had planned to issue the bond to roll-over maturing debts through book-building which opened on Wednesday with initial pricing guidance set at 20.5 percent – 21.5 percent and later revised to 19.75 percent – 21 percent.
A senior Finance Ministry official told Reuters pricing for the bond was too high. “Markets too volatile,” the official said.
Another person close to the transaction told Reuters that investor demand was poor.
“Due to current market conditions, the issuer has decided not to proceed with the proposed September 2018 5-year Treasury bond issuance (rollover) at this time. We thank you for your interest,” said the note to investors.
Book builders for the bond, open to non-resident Ghanaians, were Barclays, Stanbic, Databank, Fidelity bank and brokerage firm IC Securities.
Ghana, which exports cocoa, gold and oil, is in its final year of a $918 million aid deal with the International Monetary Fund to narrow fiscal deficit, stabilise its currency and reduce debt which rating agency Moody’s estimate will rise above 70 percent of Gross Domestic product by the end of December.