Manasseh Atta Boateng, the government’s spokesperson on finance and the economy, has reassured individuals, groups, and corporate entities that the Domestic Debt Exchange scheme will never have an impact on money invested in bonds or even treasury bills.
He noted that some people have chosen to go and withdraw their money because of worry that there will be “haircuts” when the Domestic Debt Exchange Programme is implemented.
The Domestic Debt Exchange Program, which was initially mentioned in the 2023 budget, was officially inaugurated by the government on Monday.
As part of the initiative, current domestic bonds will be exchanged for bonds with extended maturities, between five and fourteen years, maturing in 2037.
This entails extending the repayment time for locally issued and held bonds to permit a staggered and phased payment of the principal and interest.
All of these new bonds will have 0% annual coupons in 2023, 5% annual coupons in 2024, and 10% annual coupons from 2025 until maturity.
Treasury bill holders are unaffected, however institutional and private bondholders that are registered with the Central Securities Depository are (CSD).
A few hours following the announcement, however, a number of institutions and stakeholders voiced their concerns and asked for details, with almost all of the groups asserting they had not been contacted.