Gov't gives 'notice' of main bond issue

Peter Turnquest

As of Thursday, October 8, 2020

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The deputy prime minister yesterday said the Government has alerted the international capital markets that it is preparing to market and issue its foreign currency bond offering.

K Peter Turnquest told Tribune Business that "the bond notice" was issued yesterday, and signalled that the Government was proceeding in accordance with the previously outlined October/November 2020 schedule for raising the majority of the debt financing that will cover the record $1.327bn fiscal deficit projected for 2020-2021.

"I think at this point we are proceeding," Mr Turnquest said, declining to provide details such as the total amount the Government is seeking to raise; the interest rate it is offering to investors; and other likely terms and conditions.

The "notice", which was issued on the day that the Prime Minister unveiled weekend lockdowns and extended curfews to curtail COVID-19's spread on New Providence and Abaco, alerts potential investors to the fact the bond issue will become available shortly.

When asked if these restrictions, together with the slower-than-anticipated rebound of the hotel and tourism sector, make it likely that The Bahamas will have to revise its fiscal and economic growth projections, Mr Turnquest said any adjustments will be contained in the annual Fiscal Strategy Report that the Government will present to Parliament next month.

"In a couple of weeks we will report on where we are, where we think we will end up and the path for getting there," he added. "We've always said we anticipated the tourism rebound would be slow, and the domestic economy is coming along.

"It's obviously impacted by the fact a significant portion of the economy is shut down by factors beyond anybody's control at the moment. Again, we've already signalled that we are in fact reforecasting consistently."

The Government has already raised $500m worth of financing for the 2020-2021 fiscal year, including loans of $200m and $40m from the Inter-American Development Bank and Caribbean Development Bank respectively. Further financing is thought to have been raised from Bahamas-based commercial banks.

The Minnis administration is also seeking the majority of the Budget's debt financing in foreign currency, chiefly US dollars, as a means to boost the external reserves that support the one:one currency peg with the US dollar due to the absence of tourism-related capital inflows.

Noelleattlaw242 3 years, 6 months ago

Bonds are loans that come due when our children are grown...DEBT DEBT DEBT

tribanon 3 years, 6 months ago

Bahamas Government US Dollar Denominated Bond Issues

2003 98.94 $200,000,000 6.625 2033

2008 99.87 $100,000,000 7.125 2038

2009 99.47 $300,000,000 6.950 2029

2014 100.00 $300,000,000 5.750 2024

2017 100.00 $750,000,000 6.000 2028

2020 ? $1,327,000,000 ? ?

Total foreign currency denominated debt expected to be nearly US$3 Billion, and counting.

Hello Houston!! We have a major problem.

happyfly 3 years, 6 months ago

I wonder if we going to pay this back with a tourism industry, or without a tourism industry ? Or perhaps a Papa Lock Dock humpty-dumpty-on-again-off-again tourist industry ? Good thing he promised us at the beginning that not one single person would die if we all agreed to "flatten the curve' with him. What's that ? It's all "them people's" fault for not following the fake lock down science and made up rules ? Oh well. Maybe once the man has mortgaged our sovereignty to the IMF and CCP, they will do a better job of managing our economy than we can.....

DWW 3 years, 6 months ago

bond = bondage

Porcupine 3 years, 6 months ago

And, any kids who stay in The Bahamas. Just what do they have in store? No wonder Finance Monsters, I mean Ministers, can't be honest. They would be out on the street the next day.

Honestman 3 years, 6 months ago

This will be a hard sell to foreign investors.

banker 3 years, 6 months ago

The government should disclose the discount rate that they needed to sell them.

benniesun 3 years, 6 months ago

Still no government pay cuts and no significant actions on food security... Seems like our politicians are ignoring the fact that they will be punished by the Supreme being in proportion to their misdeeds. By putting many lives in bondage they will reincarnate to suffer many life times in bondage.