by Linda Straker
- 91-day Treasury Bill will be traded at maximum rate of 3.5%
- Money raised will refinance Government’s existing Treasury Bills and Treasury Notes
- Second 91-day treasury bill issued by Government for 2024; next scheduled for 9 August
Between 9 am and noon on 9 May, the Government of Grenada is hoping to raise EC$15 million through the sale of a 91-day Treasury Bill on the Regional Governments Securities Market.
It will be traded on the Secondary Market trading platform of the Eastern Caribbean Securities Exchange at the maximum rate of 3.5%. The money raised will be used to refinance the Government’s existing Treasury Bills and Treasury Notes. This is the second 91-day treasury bills issued by Government for the year 2024. The first was on 6 February, and the third time is scheduled for 9 August.
“The Treasury bill issues are being raised under the authority of the Public Debt Management Act 2015, Part 3 Section 13, Laws of Grenada. The Constitution of Grenada stipulates that Principal and Interest payments are direct charges on the Consolidated Fund,” said the prospectus which covers 2024 to 2026.
A notice on the Eastern Caribbean Securities Exchange Facebook page urged people to contact their broker if they want to invest in the treasury bills. “Yields will not be subject to any tax, duty, or levy by the Participating Governments of the Eastern Caribbean Currency Union.” The prospectus further explained that the interest rate risk is primarily attributed to the short maturity of instruments in the domestic portfolio, resulting in an Average Time to Re-fixing (ATR) of 4.8 years. “Within this domestic portfolio, 38.6% of the debt is subject to re-fixing within one year.”
“In contrast, the ATR of the external debt portfolio is longer, standing at 11.6 years, with 13.8% of the external debt subject to re-fixing in one year. Notably, a significant portion (91.1%) of the external debt is contracted at fixed interest rates, providing a degree of stability, while the remaining 8.9% comprises floating-rate debt from both multilateral and bilateral creditors. This composition indicates a certain level of resilience in managing interest rate risk within the external debt portfolio.” The document provides an overall outlook of Grenada’s economic projections up to the year 2026.
