On Thursday, 19th January 2023, a six-month Cocoa bill with face value of GH¢940.42 million matured.
The Bank of Ghana (BOG) went through the usual processes to reissue on behalf of Cocobod a new six-month Cocoa bill to raise funds to cover the maturing obligation, but the auction failed and was severely undersubscribed resulting in a shortfall of GH¢ 855.42million.
At a meeting held on Friday, 20th January 2023, among the banks, Cocobod and Bank of Ghana, it was agreed that all institutional investors will roll over their maturing cocoa bill for Tender 6155.
Financial Institutions according to a statement from the Central Bank have agreed to roll over their cocoa bills investments.
Cocoa bills, like the Bank of Ghana bills, were designed as instruments to be held just by financial institutions.
The Bank of Ghana, however, said it has come to its notice that some financial institutions sold their instruments to their retail clients.
To reduce the cash flow challenges on retail holders of cocoa bills, the Bank of Ghana, Cocobod and the commercial banks have agreed to allow banks to use Cocobod’s deposits/placements held at the various banks to cater for retail customers who may not want a rollover of their cocoa bills.
Cocobod has assured the BoG that the outlook for the 2023 crop season is good, and Cocoa purchasing are ahead of last year.
The BoG says it, therefore, expect that this short-term cash flow challenges facing Cocoa Board will be resolved soon to enable Cocobod meet its obligations to investors.
Source: Classfmonline.com