Medum term Ghanaian government bonds will be listed on the Ghana Stock Exchange by the end of September, as part of official efforts to increase the liquidity of the secondary debt markets.
The value of the securities to be listed is estimated at Cedis 2.4 trillion. All bonds will be juiced, rather than floating, rate. They are the Government of Ghana 2-year Fixed Rate Note and the Government of Ghana 3-year Fixed Rate Bond.
“Participation of non-resident Ghanaians in the Government’s medium term securities that will be listed on the Ghana stock Exchange later this month will not be allowed,” says a spokesman for Standard Bank of South Africa. “The current legislation governing dealings in money market securities does not permit non-residents to be apart of the money market. “
However, a review of the Foreign Exchange Bill has been proposed, and a bill is currently before Parliament.
“This listing of medium term securities will provide the market with a platform for secondary trading and the listing would also support a market driven yield curve that would provide a benchmark for private sector borrowers, such as issuers of corporate bonds,” continues the Standard Bank spokesman. “It would also allow market participants to develop the necessary skills in the trading of bond instruments to further deepen the capital market. The listing of the instruments will make these securities available to investors all day instead of the current situation where they can only be obtained through a Primary Dealer who has to submit a bid on behalf of the investor at the weekly auction.”
It will be mandatory for all dealers, both Government Securities Dealers (GSD) and the Licensed Dealing Members (LDM), to trade the bonds on the exchange between 0900 and 1200 hours. Over-the counter trading will be allowed between dealers after floor trading closed. The initial registration fees for GSDs and LDMs for 2006 have been waived in order to encourage GSDs to register and bring greater liquidity into the market.