Similar to the agreement reached with the banks late last week, the GraphicOnline has learned from sources that the new arrangement with the insurance sector includes last-minute adjustments to the program’s conditions.
The banks also agreed to clarify the operational framework and terms of access to the Ghana Financial Stability Fund (GFSF), remove or amend all clauses in the Exchange Memorandum that allow the Republic to, at its sole discretion, change the terms of the Exchange, and pay a five percent coupon for 2023 and a single coupon rate for each of the twelve new bonds, resulting in an effective coupon rate of nine percent.
Although the insurance firms grudgingly agreed to the arrangement, GraphicOnline has confirmed that it is identical to the one reached with the banks, despite the sources’ lack of further specifics.
Later in the day, a joint statement to that effect is anticipated.
As the deadline for the Domestic Debt Exchange Programme (DDEP) draws near, the insurance industry is anticipated to suffer a significant loss of 40% on its investments.
Although industry participants pushed hard for an exemption from the exercise so that it could honor its claim payments on schedule, the government stated that this was not an option.
According to information made accessible to GraphicOnline, the sector has an additional 10% invested in authorized banks and fund managers, with the remaining 40% of its investments, or around GH4.6 billion, being directly exposed to Government of Ghana securities.