The Bank of Ghana and the Ghana Association of Banks (GAB) have come to a compromise on how the domestic debt exchange programme (DDEP) should be executed.
A joint statement issued on Monday, January 23, by the parties described the terms for participation as agreed upon as “significant progress”.
The agreement encompasses final improvements to the terms of the DDEP, namely:
“An agreement to pay 5% coupon for 2023 and a single coupon rate for each of the twelve (12) new bonds, resulting in an effective coupon rate of 9%.
“Clarity on the operational framework and terms of access to the Ghana Financial Stability Fund (GFSF).
“The removal or amendment of all clauses in the Exchange Memorandum that empower the Republic to, at its sole discretion, vary the terms of the Exchange.”
It was also agreed by government and the Association that participation of its member banks in the domestic debt exchange programme, per the new terms, is subject to each individual bank’s internal governance and approval processes.
The banks are however supposed to conclude approval processes on time to meet the 30th January, 2023 deadline set by government for bondholders to sign on to the programme.
“This is a significant milestone towards addressing our economic challenges, and will thus help to restore macro-economic stability and accelerate Ghana’s economic growth.
“With this achievement, the Government of Ghana reiterates its commitment to concluding the DDEP in time, with all other stakeholders,” the statement pointed out.