Ghana to Securitize $3.3 Billion in Central Bank Loans

Ghana plans to convert an estimated 40 billion cedis ($3.3 billion) of loans owed to its central bank into bonds, making it the single biggest holder of domestic government securities and exposing it to an ongoing debt restructuring, Bloomberg News reported. The bonds, due to be issued by the finance ministry, will also cover interest owed to the Bank of Ghana, said the people, who asked not to be named because they’re not authorized to speak publicly on the matter. The people didn’t provide details on a timeline for the securitization, but Ghana is seeking to conclude restructuring of public debt this quarter with a view of securing IMF board approval by the end of March. The securitized central bank loan would be added to list of domestic debt under restructuring, the people added. A central bank spokesperson declined to comment when reached by phone. A spokesperson for the finance ministry didn’t immediately respond to a call and text message seeking comment. The new bonds would bring the central bank into Ghana’s ongoing debt restructuring process, under which it is asking investors to swap out 137.3 billion cedis ($11.2 billion) worth of local government securities into new notes with less attractive terms. The voluntary exchange has a Feb. 7 deadline. Read more.