- Treasury Bonds issuance series raised US$86.2 million, with a coupon of 19%.
- Global demand for the Reopening was MZN 4.33 billion (US$67.69 million), with a demand and supply ratio of 216.40%.
- To companies, this has been the best high-income risk-free investment for primary traders.
Harare - The Mozambique Stock Exchange (BVM) has announced the successful completion of its 2023 inaugural bond issuance series on 21 February 2023, with the 1st Reopening of Treasury Bonds 2023-1 Series being the final outcome. The issuance series raised US$86.2 million, with a coupon of 19%. The proceeds will be used for the development of the Mozambique economy and the repayment of existing debt.
According to the proposals presented by the Specialized Treasury Bond Operators, the global demand for the Reopening was MZN 4.33 billion (US$67.69 million), with a demand and supply ratio of 216.40%, and a minimum rate of 20.500% and a maximum of 21.750%. The State's cut-rate determined the value of the reopening to be MZN 1.45 billion (US$22.7 million).
On the initial issuance, the proposals presented by the Specialized Treasury Bond Dealers were met with a global demand of 6.1 billion MZN (US$ 95.4 million), resulting in a demand-supply ratio of 160.55% with a minimum rate of 19.0% and a maximum of 22.0%
The reopening of the 2023 1st series marginally pushed up the market cap by 1.02% cushioning a dip in the stock trade index which fell by 0.48% percent. This shows that despite the market volatility, companies with strong fundamentals are still doing well, with share trade registering a dive.
The issuance of bonds appears to be pushing the capital market's worth up in the nation, due to the substantial trading of 44,500 treasury bonds issued this year to date, at a face value of $86.2 million.
To companies, this has been the best high-income risk-free investment for primary traders that includes Nedbank, Eco Bank, Standard bank and FNB bank. These banks have been operating in the black for many years owing to their well-evaluated investment options.
Overall, the capital market in the nation is doing well, and the government's bond issuance has been a major factor in this success. Companies have been able to take advantage of this opportunity to invest in high-income, low-risk bonds, and this has been beneficial to the market.
The future looks bright for the nation's capital market, and the government's bond issuance has been a major factor in this success.
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