By kofi Ahovi
Standard Bank and the International Commercial Bank of China (ICBC) have both contributed US$100 million each to Ghana Cocoa Board’s (COCOBOD) trade finance facility of US$ 1.5 billion for the 2010/2011 cocoa season.
The US$1.5billion pre-export loan syndication finance facility, which was oversubscribed at US$1.834 billion, and the borrower increased the facility size to US$1.5 billion from US$1.2 billion, saw a total of 28 banks, including the mandated lead arrangers (MLAs), with ticket sizes following scale-backs ranging from US$5million to US$100 million. The other lead arrangers of the five banks are Credit Agricole CIB, Ghana International Bank and Denton Wilde Sapte.
The margin of the loan is 90 basis points (bp), a fall from the 250bp over Libor paid on last year’s facility, but it is double the 45bp paid on the 2008 facility.
“Cocoa is a strategic economic commodity for Ghana both as a significant contributor to GDP and as a consistent source of foreign exchange earnings. It is therefore necessary for us as a bank to promote and enhance the industry and we are happy to do this.” Alhassan Andani, Managing Director of the bank stated.
The Ghana Cocoa Board transaction remains one of the largest structured soft commodity finance facilities in the African market, and it is pleasing to see such strong and continued demand for this premier transaction from international investors, which is a reflection of its long standing structure and excellent performance track record.
Chief Executive of COCOBOD, Anthony Fofie, observed, during the signing ceremony last week in Accra, that the loan agreement is not only going to ensure that the cocoa industry continues to play its developmental role in the country but also ensure that cocoa farmers receive prompt payment for their produce.
“The future of Ghana’s cocoa industry is bright and holds many prospects for our partners in the international financial market. We therefore pledge our commitment to ensure that the cocoa industry remains vibrant and attractive to our mutual benefit in the years ahead,” he assured.
The government aims to increase the current level of less than 700,000 metric tones to one million metric tones by the year 20112. To realize this objective, the government has increased the producer price of cocoa to 71.1% of the net Freight on Board (FOB) value of cocoa exports translating to GHc2,208 per ton during the 2009/2010 cocoa season. Government also directed the payment of GHc50 million to be paid as bonus to cocoa farmers for the 2008/2009 main crop season, as well as the provision of GHc15 million seed money as social security fund for the cocoa farmers.
Established in 1947, Ghana Cocoa Board is the chief proponent of the production, processing and marketing of cocoa, coffee and sheanut in Ghana. Ghana is the second largest cocoa beans exporter in the world after Ivory Coast, providing approximately 18% of the world cocoa supply. COCOBOD continues to promote the increase in crop with larger planted acreage, improved pest control and purchase price incentives for domestic producers.
Standard Bank and the International Commercial Bank of China (ICBC) have both contributed US$100 million each to Ghana Cocoa Board’s (COCOBOD) trade finance facility of US$ 1.5 billion for the 2010/2011 cocoa season.
The US$1.5billion pre-export loan syndication finance facility, which was oversubscribed at US$1.834 billion, and the borrower increased the facility size to US$1.5 billion from US$1.2 billion, saw a total of 28 banks, including the mandated lead arrangers (MLAs), with ticket sizes following scale-backs ranging from US$5million to US$100 million. The other lead arrangers of the five banks are Credit Agricole CIB, Ghana International Bank and Denton Wilde Sapte.
The margin of the loan is 90 basis points (bp), a fall from the 250bp over Libor paid on last year’s facility, but it is double the 45bp paid on the 2008 facility.
“Cocoa is a strategic economic commodity for Ghana both as a significant contributor to GDP and as a consistent source of foreign exchange earnings. It is therefore necessary for us as a bank to promote and enhance the industry and we are happy to do this.” Alhassan Andani, Managing Director of the bank stated.
The Ghana Cocoa Board transaction remains one of the largest structured soft commodity finance facilities in the African market, and it is pleasing to see such strong and continued demand for this premier transaction from international investors, which is a reflection of its long standing structure and excellent performance track record.
Chief Executive of COCOBOD, Anthony Fofie, observed, during the signing ceremony last week in Accra, that the loan agreement is not only going to ensure that the cocoa industry continues to play its developmental role in the country but also ensure that cocoa farmers receive prompt payment for their produce.
“The future of Ghana’s cocoa industry is bright and holds many prospects for our partners in the international financial market. We therefore pledge our commitment to ensure that the cocoa industry remains vibrant and attractive to our mutual benefit in the years ahead,” he assured.
The government aims to increase the current level of less than 700,000 metric tones to one million metric tones by the year 20112. To realize this objective, the government has increased the producer price of cocoa to 71.1% of the net Freight on Board (FOB) value of cocoa exports translating to GHc2,208 per ton during the 2009/2010 cocoa season. Government also directed the payment of GHc50 million to be paid as bonus to cocoa farmers for the 2008/2009 main crop season, as well as the provision of GHc15 million seed money as social security fund for the cocoa farmers.
Established in 1947, Ghana Cocoa Board is the chief proponent of the production, processing and marketing of cocoa, coffee and sheanut in Ghana. Ghana is the second largest cocoa beans exporter in the world after Ivory Coast, providing approximately 18% of the world cocoa supply. COCOBOD continues to promote the increase in crop with larger planted acreage, improved pest control and purchase price incentives for domestic producers.
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