(Business in Cameroon) - The Cameroonian public treasury will be back on the government securities market of the Bank of Central African States (Beac) on February 19, 2020. This time the treasury is issuing 52-week fungible treasury bills.
As was the case for the February 12, 2020, operation, the country is seeking XAF20 billion, according to the press release published by the Ministry of Finance.
Let’s note that on February 12, 2020, Cameroon recorded its very first poor performance on this BEAC’s public securities market since its launch in 2011. While it was seeking XAF20 billion by issuing 26-week fungible treasury bills, the Cameroonian government was only able to obtain XAF5.2 billion, even though subscriptions reached more than XAF18 billion.
The authorities did not indicate the reasons for this performance. However, on analysis, Cameroon may well have been driven off by interest rates ranging between 2.4 and 3.5% demanded by investors. The average interest rate demanded by investors for the operation was 2.7% while for its first operation for this fiscal year, on January 8, 2020, it was 2.1%.
The impending February 19 operation, with a slightly longer maturity, may also explain Cameroon’s reluctance on taking debt at a slightly higher rate for a shorter maturity period.