![](\"http:\/\/www.ghanamma.com\/wp-content\/uploads\/2022\/08\/Ken-Ofori-Atta.jpeg\")
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About 94% of the \u00a23.9 billion Tier 2 pension contributions placed in government securities may be affected by a probable Debt Restructuring Programme.<\/p>\n
A debt restructuring will mean the yield-to-maturity of government bonds and bills will be extended or better still the \u2018haircut\u2019 policy will be enforced. This will potentially affect the return on investments.<\/p>\n
In financial markets, a haircut refers to\u00a0a reduction applied to the value of an asset. For example, if an asset \u2013 such as holdings of a particular government bond \u2013 is worth \u00a21 million but is given a haircut of 20%, it means it is treated as though it has a value of only \u00a2100,000.<\/p>\n
Joy Business understands that the government will have to restructure the country\u2019s debt as a pre-condition for an economic programme from the International Monetary Fund.<\/p>\n
Should this happen, the maturing periods of these securities will be affected.<\/p>\n
Almost the entire pension funds of Tier 2 contributors have been invested in the Government of Ghana instruments, particularly bonds. This is because government securities are classified essentially as risk-free.<\/p>\n
However, the current fiscal challenges facing the economy, particularly ballooning debt and unsustainable interest payments raise some concerns.<\/p>\n
The government yesterday announced a 5-Member Consultative Committee chaired by astute banker, Albert Essien, to lead the financial sector stakeholder engagements to reach a deal with the IMF in Ghana\u2019s debt restructuring.\u00a0<\/p>\n
The group will examine views from financial sector players to deal with issues in the financial sector before reaching a deal with the IMF for an economic programme.<\/p>\n
Joy Business is learning that the group is different from the credit committee that will also engaged the Fund.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
About 94% of the \u00a23.9 billion Tier 2 pension contributions placed in government securities may be affected by a probable Debt Restructuring Programme. A debt restructuring will mean the yield-to-maturity of government bonds and bills will be extended or better still the \u2018haircut\u2019 policy will be enforced. This will potentially affect the return on investments. […]<\/p>\n","protected":false},"author":1,"featured_media":1183209,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[72],"tags":[27302,2553,1580,1235,11160,3283],"class_list":["post-1222495","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-3-9bn","tag-affected","tag-debt","tag-pension","tag-restructuring","tag-tier"],"_links":{"self":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts\/1222495","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/comments?post=1222495"}],"version-history":[{"count":0,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts\/1222495\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/media?parent=1222495"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/categories?post=1222495"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/tags?post=1222495"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}