Moody’s provides B1 to Ghana bond

Moody's Investors Service said it assigned a provisional B1 rating to the proposed bond issue by the Republic of Ghana.

The bond is enhanced by a partial guarantee provided by the International Development Association (IDA, unrated) which shall be the lesser of $400 million and 40% of the face value of the bond.

Ghana's issuer rating is B3 with a negative outlook.

Moody's expects to remove the provisional status of the rating upon the closing of the proposed issuance and a review of its final terms.

Separately, the government of Ghana has approvals to issue an additional Eurobond in 2015 without guarantee. Moody's will assign a provisional B3 rating, in line with the issuer rating, to subsequent bond issues upon review of the provisional terms.

Conditional on Ghana's successful completion of an IMF review mission, on June 30 the World Bank (IBRD, Aaa stable) approved the first Policy-Based Guarantee (PBG) via its IDA arm, offering Ghana a partial bond guarantee of up to $400 million to facilitate the sovereign's access to external funding of up to $1 billion.

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