2023-06-05 08:40:07
• Out of a total of 35.1 billion FCFA proposed
• Full house for 364-day and 7-year issues
• Investors shun the 3-year OAT
Lhe signature Burkina Faso is in the process of regaining its letters of nobility on the regional financial market. Quite shunned during the second half of 2022, the issues made by the country are attracting more and more investors. This is the case of that of May 24, 2023. At the request of the General Directorate of the Treasury and Public Accounting of Burkina, Umoa-titres and the BCEAO organized a simultaneous issue of Bonds and similar Bonds of the Treasury. These three operations are respectively at 364 days, 3 and 7 years, for an amount of 30 billion FCFA. “This operation is part of the execution of Burkina’s public securities issuance program in accordance with the medium and long-term debt management strategy”, we learn from the press release published by the BRVM. . Thus, out of the 30 billion sought, Burkina Faso mobilized 30.17 billion FCFA, i.e. a coverage rate of 117.25%.
The first issue is that of assimilable Treasury bonds (BAT) of 364 days. These are short-term debt securities issued by the State by auction. This type of BAT has the advantage of meeting cash management requirements combining security and quality, with an optimal return/risk ratio and known remuneration paid in advance to the investor, when acquiring the securities. (pre-computed interest). Among the 3 emissions of the country, it is that which was the most popular. The amount retained is 23.03 billion FCFA, with 20 submissions and 10 participants. The investors who presented themselves come from Burkina Faso (10.09 billion), Côte d’Ivoire (4 billion), Senegal (7.93 billion) and Togo with one billion FCFA retained.
For this exit on the financial market, Burkina has used, in addition to BAT, assimilable Treasury bonds, commonly called “OAT”. These are medium and long-term debt securities, issued by the State by auction. They can relate to maturities of 3 years, 5 years, 7 years, 10 years, 15 years or more.
By way of advantages, OATs offer a medium or long-term investment that meets the investment requirements of your savings or your long-term resources. These securities combine security (sovereign issuer) and quality (the State). OATs offer the investor an optimal return/risk ratio. Investing in OATs makes it possible to contribute to the financing of the State budget. For example, the State might use these resources to finance public infrastructure (airport, highway, hospitals, schools, etc.).
And on this type of operation, investors preferred 7-year OATs, which are longer, to those of 3 years. The amount retained for the 7-year Bonds is 3.95 billion FCFA, with 9 submissions and 4 participants. The absorption rate is 100%, compared to 44.4% for 3-year OATs.
At this level, submissions come only from Burkina Faso. With regard to 7-year OATs, there were submissions from Benin, Burkina Faso, Togo, Côte d’Ivoire and Senegal.
NK
framed
Securities are tax exempt for investors residing in Burkina
Lurkina is not on its first simultaneous broadcast. Before that of May 24, 2023, Burkina was on the financial market on May 10. This simultaneous issuance of similar Treasury Bills and Bonds covered periods of (182 days)… years and 7 years respectively for an amount of 30 billion FCFA. Investor enthusiasm was there.
It should be noted that similar Treasury Bills and Bonds are eligible for refinancing by the Central Bank under the conditions set by the Monetary Policy Committee and are negotiable on the secondary market, in accordance with Regulation No. 06/2013/CM/UEMOA of the June 23, 2013.
In terms of taxation, income received on similar Treasury Bills and Bonds is exempt from tax for investors residing in Burkina. Non-residents are subject to the taxation applicable in the territory of the country of residence.
Box 2
Brief Finances
African Banker 2023 : the list of winners
17e edition, the African Banker Trophies delivered their verdict on May 25, in Sharm El Sheik, Egypt, on the sidelines of the AfDB’s general meetings. These trophies celebrate the achievements of leaders and institutions that have contributed significantly to the growth and development of Africa’s financial sector over the past year.
The ceremony was organized under the high patronage of the African Development Bank. The 2023 African Banker Awards are sponsored by the African Guarantee Fund, Trade and Development Bank (TDB) and CRDB of Tanzania.
Banker of the Year: Mme Esther Kariuki, Co-operative Bank of Kenya
Bank of the Year: Afreximbank
Icon of the African banker: Miguel Azevedo, Citi
Exemplary career: Mr. Hisham Ezz Al-Arab, Commercial International Bank
Central Bank Governor of the Year: Harvesh Seegolam, Bank of Mauritius
Finance Minister of the Year: Mr. Enoch Godongwana, South Africa
Sustainable Bank of the Year: Nedbank, South Africa
DFI of the year: Afreximbank
Fintech of the year: MFS Africa
Bank of the Year for SMEs: Compensation and Consignment Fund (CDC), Tunisia
Deal of the Year – Debt: US$400 million, R4 billion multi-tranche, multi-currency syndicated loan facility for Harmony Gold – Absa and Nedbank
Deal of the Year – Equities: US$298 million equity investment in Infinity Energy and acquisition of Lekela Power – Africa Finance Corporation
Operation of the Year – Agriculture: US$78 million financing facility for the Southern Petroleum Commodity Structured Finance Transaction – Absa
Deal of the Year – Infrastructure: US$900m Debt Financing Facility for Scatec Solar PV Project with Battery Energy Storage – Standard Bank
Regional Bank of the Year – North: Bank of Africa
Regional Bank of the Year – South: Zambia National Commercial Bank (Zanaco)
Regional Bank of the Year – East: CRDB Bank
Regional Bank of the Year – Center: Trust Merchant Bank
Regional Bank of the Year – West: View Bank
AFAWA Bank of the Year: Letshego, Nigeria.
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