Ofori Atta Modifies DDEP, Extends Deadline
The Ministry of Finance has announced modifications in the Domestic Debt Exchange Programme (DDEP) offer and extended the deadline for the fourth time.
The announcement was made in a press statement on Tuesday, January 31, 2023.
Modifications
According to the Ministry, the Government of Ghana has made significant progress with all stakeholders, including financial sector industry associations and representative groups of individual bondholders, with respect to their participation in the Domestic Debt Exchange Programme (DDEP).
It said, all individual bondholders below the age of 59 years will be offered instruments with a maximum maturity of 5 years, instead of 15 years, and a 10% coupon rate as part of the modification.
Also, all retirees- including those retiring in 2023- will be offered instruments with a maximum maturity of 5 years, instead of 15 years, and a 15% coupon rate.
The DDEP offer has now been declared voluntary, however, upon a successful DDEP, the Ministry said, there will be very few of the ‘old bonds’ in circulation, and likely limit its tradability.
According to the Finance Ministry, the Ghana Association of Banks (GAB), Ghana Insurers Association (GIA), and the Ghana Securities Industry Association (GSIA) have accepted the new terms of the new terms of the exchange.
A revised and final Exchange Memorandum will be released by Thursday 2nd February 2023, it said.
Meanwhile, it said discussions are being finalised with Organized Labour and Pension Fund Trustees, on a separate arrangement in accordance with the Memorandum of Understanding signed with Organized Labour on 22nd December 2022, and in line with government’s debt management Programme.
“With this, Government encourages all stakeholders to participate in the DDEP, an essential step towards meeting our debt sustainability targets and restoring macroeconomic stability and economic growth”, the Ministry urged.
Deadline Extension
Due to the development, the Ministry of Finance has found it necessary to extend the deadline of the offer for the fourth time.
The programme was first scheduled to end on Monday, December 19, however, it was extended to December 30 with a contemplated settlement date of Friday, January 6, 2023.
At the time, it was reported that no financial institutions had taken up the offer, but the Finance Ministry said the extension was to help the financial sector secure internal and Executive Board approvals to take up the Exchange offer.
On December 24, the Finance Ministry announced the second extension after excluding pension funds from the programme and including individual bonds.
The programme was then extended to January 16, 2023.
In a tweet on 16 January, the Office of the Finance Minister announced the third extension following opposition by individual bondholders.
He noted that consultation is ongoing and therefore, the expiration for the offer has been extended to the end of January.
On January 31, the Ministry said the offer’s deadline had been extended to Tuesday 7th February, 2023, with a new settlement date of Tuesday 14th February, 2023.
Source: opemsuo.com/Hajara Fuseini
