GSE trains fixed income market securities dealers

The Bank of Ghana (BoG) is working with stakeholders, to deepen the fixed income securities market and to develop a good secondary market that provides investors the opportunity to buy and sell their holdings.

Mr Millison Narh, the Deputy Governor of the BoG, said the move is in line with the new BoG Act requiring it to cut down lending to the government to five per cent of the previous year’s revenue.

It is in this direction that the BoG and stakeholders are encouraging the secondary trading of fixed income securities.

Mr Narh, who was speaking at a four-day training programme on the Ghana Fixed Income Market for dealers, said the BoG is licensing primary dealers with the requisite financial resources, to play an intermediary role and provide opportunity for investors who would want to sell their investments.

The training was organised by the Ghana Stock Exchange, Frontclear and the International Capital Market Association.

Mr Narh said the objective for a robust fixed income market is to have a liquid, transparent and price discovery, which has eluded the market for a very long-time.

He said although the emphasis is currently on fixed income government bonds, this is to be extended to corporate and municipal bonds in the future.

He said a good secondary market provides investors the opportunity to offload any quantity they want to provide liquidity.

He said it is the quest to develop a very strong financial sector to support the real sector of the economy.

On the economy, the Deputy Governor said investor confidence had rebounded as a result of the prudent economic management.

He said the deficit that was witnessed throughout 2013 had reduced through a combination of fiscal and monetary policies leading to the transformation of the economy.

Dr Narh said the cedi has been stable, depreciating by 4.1 per cent against the dollar this year as opposed to 16.1 per cent in 2015.

Topics being discussed include money market transactions, fixed income fundamentals and fixed income market risk.

Source: GNA