The Domestic Debt Exchange Program (DDEP), which would put “haircuts” on the bonds, has been opposed by the Ghana Individual Bondholders Forum (IBF), which has asked all bondholders to hold onto their bonds.
The IBF claims that if bondholders in the various DDEP categories signed up for the scheme, they would significantly lose the value of their investment.
According to the report, bondholders in Category A, which is for investors younger than 59 years old, could lose up to 33% of their investment value, those in Category B, which is for investors older than 59 years old, could lose up to 18.7%, and those in Category C, which includes other bondholders like corporate institutions and banks, could lose up to 45.4 percent.
“The IBF recommend to its members that individuals and collective investment schemes (especially Money market funds) and the 1 million other IBs and persons who have invested in collective investment schemes hold on to their current bonds,” the IBF said in a statement yesterday.
The IBF said that the government’s agreement to exclude pension funds from the program was a further justification for not joining the DDEP.
The organization argues that while the government would uphold the provisions of the bonds owned by pension funds, it (the government) cannot opt to discriminate against those bondholders who choose not to sign the DDEP.
“The IBF holds the view that because Pension Funds (PFs) who are exempted from the DDEP and IBs who do not opt-in to the DDEP will be holding similar bonds, GoG cannot legally discriminate against the servicing of same bonds held by different investors. All are required to be treated equally on pari passu basis
It was said that the exemption of PFs “effectively strengthens the insulation for IBs from selective government abuse.”
Today, February 10, 2023, is the last day of the government’s extra time for bondholders to finish the tender procedures associated with the contentious Domestic Debt Exchange Programme (DDEP).
The deadline was extended from February 7 to provide bondholders who encountered technical difficulties more time to complete the online procedures for tendering their bonds.
Following the opening of a three-day administrative window, the Ministry of Finance claims it is getting the necessary response from various parties and people.