The Bank of Ghana, Ghana Cocoa Board (COCOBOD) and the commercial banks have agreed to allow banks to use COCOBOD's deposits/placements at the banks to cater for retail customers who may not want a rollover of their cocoa bills.
This is coming after the BoG initially directed banks not to pay customers their maturing cocoa bills investments, following cash flow challenges facing COCOBOD.
A statement issued by the BoG in Accra yesterday said it expected that the short-term cash flow challenges facing COCOBOD would be resolved soon to enable the cocoa regulator meet its obligations to investors.
"COCOBOD has assured us that the outlook for the 2023 crop season is good, and Cocoa purchasing are ahead of last year. We therefore expect that this short-term cash flow challenges facing COCOBOD will be resolved soon to enable it to meet its obligations to investors."
On Thursday, January 19, 2023, a six-month Cocoa bill with face value of GH¢ 940.42 million matured.
"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 unfortunately, the auction failed and was severely under subscribed resulting in a shortfall of GH¢ 855.42million," the statement said.
"At a meeting held on Friday, January 20, 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 have agreed to roll over their cocoa bills investments," it explained.
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It added that "cocoa bills, like the Bank of Ghana bills, were designed as instruments to be
held just by financial institutions. Unfortunately, it has come to the notice of the Bank of Ghana 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 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 issued the bill to raise funds. Many had bought the bills expecting to be paid back their monies with interest on Thursday, January 19, 2023.
According to JoyNews, the monies were actually paid on Thursday, January 19, 2023, only to be reversed on Friday, January 20, 2023.
The banks have pointed to a directive from the Bank of Ghana ordering them to unilaterally roll over the bonds without first seeking the consent of investors.
