The Bank of Ghana has sold GH¢12.57 billion in 14-day bills at an annualised weighted average interest rate of 10.50 per cent, following its latest short-term securities tender held on November 9.
The sale, recorded under Bank of Ghana Securities Tender 887, involved a single instrument with a maturity period of 14 days. The central bank reported total sales of GH¢12,569.88 million.
According to the tender results, accepted bids carried discount rates ranging from 10.4577 per cent to 10.4578 per cent, while the corresponding interest rates ranged from 10.4999 per cent to 10.5000 per cent.
The weighted average discount rate stood at 10.46 per cent, with the weighted average interest rate recorded at 10.50 per cent per annum.
The 10.50 per cent figure represents an annualised rate and should not be interpreted as the return investors will earn over the 14-day investment period.
The tender results also indicate that bids at the reported rates were allotted in full. However, the Bank did not disclose the total amount offered by investors, the number of bids received or the amount initially targeted for the auction.
This means the GH¢12.57 billion sale alone does not establish whether investor demand exceeded the amount the central bank intended to raise. It is therefore not possible to determine the tender’s bid-to-cover ratio or conclude that it was oversubscribed.
The issuance forms part of the Bank of Ghana’s short-term liquidity management operations. Through the sale of its own bills, the central bank absorbs funds from the financial system for a specified period, temporarily reducing the amount available for other uses.
The operation is different from government Treasury bill issuance, as the securities involved are Bank of Ghana bills rather than government debt instruments.
With a maturity period of just 14 days, the latest issuance also represents a temporary liquidity management measure. The funds absorbed will become due for repayment when the bills mature, requiring the Bank to manage the resulting liquidity position.
However, the tender notice does not indicate the maturity date, the volume of earlier bills falling due or whether the Bank intends to replace them with fresh issuances.
The 10.50 per cent weighted average interest rate provides a reference point for the cost of short-term funding through the instrument. However, without comparable results from previous tenders, it is difficult to establish whether the rate has increased or declined.
For now, Tender 887 confirms that the Bank of Ghana sold GH¢12.57 billion in 14-day bills at an annualised weighted average interest rate of 10.50 per cent, offering a snapshot of its latest short-term liquidity management operation.
