US$1bn Eurobond listed on Ghana Stock Exchange

BY: Samuel K. Obour

Seth Terkper, |Minister for FinanceThe government has successfully listed the US$1 billion Eurobond issued earlier this month on the Ghana Stock Exchange.

This makes it the first Eurobond to be listed on the exchange of a country in sub-Saharan Africa (SSA).

The bond is now being traded on the Irish Stock Exchange (ISE) at a rate of 8.17 per cent.

The Minister of Finance and Economic Planning, Mr Seth Terkper, symbolically listed the bond on the GSE on Tuesday, making it possible for foreign and domestic investors to buy and trade in the Eurobond on the Accra bourse.

This is expected to help increase investor appetite on the local bourse while deepening capital market activities in the country in general.

Mr Terkper, who led a team of experts from the country to issue the bond on July 25, said the listing and subsequent trading of the bond on the GSE added to government’s commitment to develop the capital market.

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The country requires an estimated US$1.2 billion annually to fund its infrastructural needs, and the minister is confident a well-developed capital market would help mobilise the needed funds to support these capital expenditures.

“In addition, such markets are necessary for enhanced financial stability and better integration in the global financial landscapes,” he added.

The Managing Director of the GSE, Mr Kofi Yamoah, told the Daily Graphic after the event that the listing and subsequent trading of the bond on the Ghana market would help boost the image of the local bourse, especially in the eyes of the international investor community.

“This development is a clear indication the government’s commitment to developing the bond market and we appreciate it,” he said, adding that the Eurobond would now serve as a benchmark to investors and issuers of bonds in and outside the country.

Mr Yamoah was also optimistic the development would appeal to other corporate issuers to float bonds on the bourse, something he said would open the market to more investors in and outside the country.

The US$1 billion Eurobond is a 10-year dated instrument that was issued on July 25 at a coupon rate of about 7.88 per cent.

It was the second Eurobond to be issued by the country after the maiden one, worth US$750 million, which was issued six years ago.

Proceeds of the current issue are to help retire maturing debts, support government’s infrastructural development programmes and meet capital expenditure captured in this year’s budget.

Its listing on the GSE adds to the two, three, five and seven year corporate and government bonds being traded on the exchange.

By Maxwell Adombila Akalaare/Daily Graphic/Ghana