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The Bank of Zambia (BoZ) has announced a change in issuance method of the government bonds, entailing that the coupon rate for each instrument will be determined during the auction.
The change had been made to streamline government debt metrics and debt service in general.
Issuance at par entails that the coupon rate for each instrument will be determined during the auction, according to a statement issued on Wednesday by the Central Bank Communications unit.
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The Central bank advised that the coupon rate for each instrument on auction would be the respective highest accepted yield rate.
According to the statement, re-issuances of any existing bonds and secondary trading of any bonds may be done at discount, par or premium depending on market conditions.
“The Bank of Zambia wishes to inform the General Public and investors in government securities that effective from January 2024, the government of the Republic of Zambia bonds (GRZ bonds) will be issued at par in the primary market for all new issuances.
“This means that government bonds will be sold at their face value, that is, the cash amount to be invested will be the same as the face value amount. The General Public and all investors are advised accordingly,” the Central bank communicated.
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