Ghana’s terms of restructuring for its local bonds is said to be favoring domestic creditors over its offshore creditors. Ghana commercial banks agreed to the government’s proposal of a 5% coupon payment in a domestic debt swap program and also agreed on a single coupon rate of 9% for each of 12 new bonds. Carlos de Sousa, a money manager at Vontobel Asset Management said,”I see a positive and a negative side… On the positive side, the government is showing flexibility to reach an amicable solution with domestic bondholders instead of imposing a restructuring. On the negative side, if the domestic debt restructuring is too modest, then a larger burden may have to fall on external creditors”. Ghana is currently in the process of restructuring most of its public debt of ~ $39bn as of end-September, in order to qualify for a $3bn IMF bailout.
Separately, Ghana’s dollar bond maturing 18 January 2026 was downgraded to D from CC by S&P after the country failed to pay about $41mn in interest.
Ghana’s dollar bonds were slightly higher by 0.6-1 point at 37-39 cents on the dollar.
For the full story, click here