Members of the Individual Bondholders Forum, who’re at the moment being engaged on the Domestic Debt Exchange programme by the Finance Ministry, have reacted to the settlement reached between the Government and the Ghana Association of Bankers (GAB) on the brand new phrases for the programme.
The Government of Ghana and the GAB reached the settlement on Monday, January 23.
Earlier, the banks rejected the programme as introduced by the federal government.
The GAB directed industrial banks not to signal onto the amended debt trade provide over uncertainty surrounding the affect of the debt restructuring on the banking trade.
The affiliation needs its issues addressed earlier than accepting the debt trade provide, in accordance to a letter despatched to managing administrators of banks and seen by 3Business. GAB advised member banks that will need to contemplate the debt trade in its present type to formally inform the affiliation first earlier than doing so.
“…From the uncertainty surrounding the programme, GAB recommends that all banks must stay any further movement on the exchange until our demands have been met. However, in the event that a bank may have to move forward to exchange, the MD/CEO must inform the CEO of GAB directly of the decision,” in accordance to the letter despatched to the banks.”
However, after an engagement with the Ministry of Finance, the Association of Banks that per the brand new phrases, the participation of member banks is subjected to particular person financial institution’s inner governance and approval processes.
“This is a major milestone in direction of addressing our financial challenges, and can thus assist to restore macro-financial stability and speed up Ghana’s financial progress.
“With this achievement, the Government of Ghana reiterates its commitment to concluding the DDEP in time with all other stakeholders,” a joint assertion from the Finance Ministry and GAB famous.
In an announcement reacting to his improvement, Covener of the Individual Bondholders Forum, Senyo Hosi mentioned “This improvement reaffirms the necessity for presidency to exclude Individual Bondholders, together with people and Collective Investment Schemes (CIS), who account for lower than 11% of the eligible bonds. Unlike the banks and different establishments who’re set to benefit from numerous regulatory incentives, Individual Bondholders have no fall back nor incentives and will probably be condemned to shackled penury.
“We urge the government to stay focused on its responsibility to protect its citizens and for that matter, absolutely exempt Individual Bondholders, including individuals who hold eligible bonds under the DDE through Collective Investment Schemes from its DDE programme. We maintain that cutting government expenditure and optimizing revenue is the sure winner for Ghana in these difficult times.”
Below is his full assertion…
We have taken word of the joint press launch by the Ministry of Finance (“MOF”) and the Ghana Association of Bankers (“GAB”) dated twenty third January 2023. We congratulate each events for reaching a deal in direction of the reengineering of our economic system.
We observe with delight authorities’s numerous incentives offered to the banks which amongst others embody the Bank of Ghana’s forbearances and beneficial revisions to the prudential guidelines together with reductions within the Capital Adequacy Ratio and the Cash Reserve Requirements.
To make it rather more practical, the federal government will probably be offering a monetary stability fund to assist the viability of the banks.
With the banks onboarding the Domestic Debt Exchange Programme, the federal government is ready to attain its 80% goal.
This improvement reaffirms the necessity for presidency to exclude Individual Bondholders,
together with people and Collective Investment Schemes (CIS), who account for lower than 11% of the eligible bonds. Unlike the banks and different establishments who’re set to benefit from numerous regulatory incentives, Individual Bondholders have no fall back nor incentives and will probably be condemned to shackled penury.
We urge the federal government to keep centered on its accountability to defend its residents and for that matter, completely exempt Individual Bondholders, together with people who maintain eligible bonds below the DDE via Collective Investment Schemes from its DDE programme. We preserve that chopping authorities expenditure and optimizing income is the positive winner for Ghana in these troublesome occasions.
Proverbs 14:31 says “whoever oppresses a poor man insults his Maker, but he who is generous to the needy honours the Lord”. May our authorities be honoured.
Press Release- GAB MoF Deal Affirms want to Exclude IBs and CIS
By Laud Nartey|3news.com|Ghana