Financial institutions to buy into energy sector bond

Some financial institutions in the country have indicated of their readiness to buy into the energy sector bond yet to be released by government later this year.

This they believe will aid government get the energy sector back on a strong financial footing.

Dr. Bawumia at the spring meetings in Washington in April this year, announced plans to issue a 15 year bond to clear the 2.4 billion dollars debts.

Managing Director for STANLIB, Emmanuel Alex Yaw Asiedu who spoke on the sidelines of the STANLIB AGM said the financial institution has confidence in the bond and will most likely buy into it.

“It’s a qualified yes because no matter who the counter-parties are, we will have to look at the fundamentals before we buy into it.

But we would want to think that it’s going to be well structured so it’s something that we will very likely buy”, Mr Asiedu said.

Performance of STANLIB for its Income Trust Fund, recorded Net investment income increase by 52% (2016: GHS 3,985,038; 2015: GHS2,616,530)

The fund expenses grew to GHS427,215 in 2016 by 45% from GHS 294,616 in 2015, strong growth in Interest income by 52% in 2016 ensured the strong growth in the net investment income.

Total income grew to GHS4,412,253 in 2016 from GHS2,911,146 in 2015 hence 51.5% increase year-on-year.

This according to the institution is on the account of increase in interest income which was driven by investment in long term fixed income securities.

Increase in total expenses was mainly driven by the increase in fund management fees (2016: GHS 353,487; 2015: GHS 230,410)

For its Cash Trust Fund Net investment income increased to GHS 4,188,697 in 2016 from GHS 1,667,534 in 2015 hence 151.19% increase

Although the fund expenses grew to GHS 580,043 in 2016 from GHS 234,334 (147.52% increase), strong growth in total interest income to GHS4,768,740 in 2016 from GHS 1,901,868 in 2015 (151%) ensured the strong growth in the net income.

The increase in interest income was driven largely by the increase in placements on the money markets.

Increase in total expenses was mainly driven by increases in fund management fees trustees’ fees.





Source: B&FT Online