Ofori-Atta lauds indigenous firms’ role in $3bn bond sale

Ofori-Atta lauds indigenous firms' role in $3bn bond sale

Mr Philip Owiredu (2nd left), MD, CalBank PLC, and Mr Sam Aidoo (4th right), Deputy MD, Fidelity Bank, with some management executive of the indigenous firms that helped to issue the $3 billion Eurobond The Minister of Finance, Mr Ken Ofori-Atta, has lauded the role played by five indigenous financial institutions in raising $3.025 billon in Eurobond for the country.

The institutions which led in raising the bond last month are Fidelity Bank Ghana Limited, Cal Bank PLC, Databank Brokerage Limited, IC Securities (Ghana) Limited and Temple Investments Limited.

They acted as co-managers of the transaction, which turned out to be the country’s largest bond sale in history and featured a novel zero-coupon Eurobond, the first of its kind by an emerging market economy.

Mr Ofori-Atta told the Daily Graphic in Accra that he was delighted with the role of the indigenous firms in the issuance processes, saying their active involvement was a testament to the fact that the effort by the government to develop indigenous capacity in the banking and financial sectors was yielding the expected results.

Beyond helping investors domiciled in the country to access the international capital market, he said, the arrangement also ensured that almost 50 per cent of the novel zero-coupon bond was taken up by resident investors, a development that was positive for the economy.

“For the first time in Africa, we have seen local managers drive significant local market participation in fund-raising in a global Eurobond. Close to 50 per cent of the zero-coupon bond was taken up by the local market through the efforts of the local co-managers, " Mr Ofori-Atta added.

Co-managers’ role

Known as co-managers in finance parlance, the five indigenous firms played supporting roles to the joint lead managers in the issuance that was oversubscribed, in spite of the grimness that the COVID-19 pandemic posed to investor appetite.

They worked with their foreign counterparts to develop investor presentation, fashioned out the liability management strategy and coordinated logistics for the first ever virtual roadshow outside Accra. PEGAS RANA MOTTORS That helped to aggregate what turned out to be significant domestic demand for all tranches of the Eurobond, with the largest being the debut zero-coupon bond.

Experts say the demand for the local co-managers came mainly from domestic indigenous investors, and that provided access for Ghanaian investors on the international capital markets.

Historically, local co-managers have contributed relatively lower amounts to the total order books.However, in recent […]

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