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BusinessKasapreko has a better credit than Ghana govt - Bright Simons

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Kasapreko has a better credit than Ghana govt – Bright Simons

Vice President of think-thank IMANI Centre for Policy and Education, Bright Simons, has reacted to Kasapreko listing the first part of its GHS600 million bond programme on the Ghana Stock Exchange.

This bond programme is basically a way for Kasapreko to borrow money from investors for three years.

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The first part of the bond is worth GHS 103.7 million, and Kasapreko will pay a 26% interest rate on it every two years.

In a post X, Mr Simons noted that the country’s economic downturn has put pressure on Kasapreko, prompting the company to explore alternative financing options.

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According to him, “managers believe the company can borrow cheaper than the govt of Ghana because it has better credit.”

“It is trying to get investors to lend to it at 26%. Significantly lower than it can borrow from a bank today. Since a bank or any other investor can just buy treasuries, only reason they will buy a Kasapreko bond is if they feel that govt might default,” he added.

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He noted that the corporate bond market was growing until the government default, Domestic Debt Exchange Programme, impacted it negatively.

Kasapreko’s bond was issued on January 29, 2024, and will mature, or be fully repaid, on January 29, 2027.

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