BANK OF GHANA
NOTICE TO THE GENERAL PUBLIC
NOTICE NO. BG/ TD/ 2014/ 06
PROSPECTUS FOR THE ISSSUE OF GHC 402 MILLION GOVERNMENT OF GHANA 3-YEAR FIXED RATE BOND
1. INVITATION OF BIDS
Further to the Bank of Ghana Notice No. : BG/ TD/ 2014 /01 on the Issuance Calendar for Government of Ghana securities for the half-year period, 1st January – 30th June, 2014, the Bank of Ghana invites bids for the issue of the above instrument on behalf of the Government of Ghana through the Auction process .
The instrument will be Ghana cedi-denomination and will be issued at par. It shall bear a coupon rate equal to the highest competitive bid accepted at the auction for the security. The coupon rate so fixed shall carry throughout the term of the security.
2. TERMS
Issuer: Government of Ghana
Purpose: Debt Restructuring/ Benchmark Instrument/ Finance Capital Project
Amount: GHC 402 million
Issue Method: Through an auction to be held on 13th February, 2014
Price: The instrument shall be issued at par
Denomination: Each Bond shall have a face value of one Ghana cedi.
Minimum Bid: GHC 50,000 and multiples of GHC 1,000 thereafter.
Coupon: To be determined at the auction to be held on 13th February, 2014, as described under (1) above.
Interest Payment: Semi-annually from the Issue Date, in August and February.
The amount of the interest paid on every coupon payment date shall be equal to the principal amount at the coupon rate for half-year.
Withholding Tax: The Internal Revenue Act 2000 requires the Bank to withhold tax in respect of interest payments to resident corporations holding Bonds on their own account at the rate of 10% of the gross amount of the payment. Interest paid to a non-resident holder (individual and institution) on Bonds issued by the Government of Ghana is exempted from tax.
Application Methods : Bids may be made on either a competitive or non-competitive basis through Primary Dealers only. Primary Dealers may also submit bids on their own behalf. Bids received will not be revocable.
Participation: The 3-year Fixed Rate Bond shall be available to both resident and non-resident investors.
Closing Date: Bids must be electronically delivered to the Central Securities Depository Auction Module not later than 1.30 p.m. on Thursday, 13th February, 2014.
Allocation of Bonds: The Bank of Ghana reserves the right to reject any or part of a competitive or non-competitive bid. Subject to this, competitive bids will be ranked in ascending order of the annual rate of interest bid. Securities will be sold to applicants whose competitive bids are at or below the highest rate at which the Bank of Ghana decides that any competitive bid would be accepted (the “uniform allocation rate”). Applicants whose competitive bids are accepted will purchase securities at par with the coupon fixed at the uniform allocation rate. Competitive bids which are accepted and which are made at rates below the uniform allocation rate may be satisfied in part only.
Settlement: Settlement shall take place on 17th February, 2014.
Register: The Register will be maintained on a book-entry system at the Central Securities Depository and therefore no certificates will be issued.
Listing of Bonds: The security shall be listed on the Ghana Stock Exchange (GSE) for secondary market trading both at the floor of the Exchange and over the counter (OTC). Trading in the securities is subject to the rules of the GSE for Government Securities.
Redemption: The Bond shall be redeemed by the issuer on the maturity date, which shall be 13th February, 2017. Such redemption shall be at par.
CAROLINE OTOO (MRS)
THE SECRETARY
5th February, 2014
