Market Review April 2017 Market in Brief April 2017 saw improvement in key economic indicators. The Ghana cedi recovered strongly against major trading currencies, especially • • • • • • the US dollar, and yields on government debt securities eased considerably. Policy Rate 23.5% • • • Forex and Money Markets Inflation The Ghana cedi performed appreciably against major trading currencies 12.8% during the month. The currency gained 3.1 percent month-on-month (March Y/Y) against the US dollar to close the month at 4.1874, improving year-to- • • • date performance to 0.3 percent [appreciation]. The currency also gained 1.2 percent versus Euro and lost 0.4 percent versus British Pound, Interest Rate sending year-to-date performances to -2.7 percent [depreciation] and 15.4% -4.1 percent [depreciation], respectively. (91-day bill) • • • Interbank Exchange Rate April 30 March 31 Month Chg. (%) YTD Chg. (%) Cedi Performance USD/GHS 4.1874 4.3173 3.1% (APN) 0.3% (APN) GBP/GHS 5.4163 5.3964 -0.4% (DPN) -4.1% (DPN) 0.3% EUR/GHS 4.5611 4.6164 1.2% (APN) -2.7% (DPN) (USDGHS YTD Return) APN - Appreciation | DPN - Depreciation • • • In the money market, yield on 91-day treasury bill fell 207 basis points GSE Composite Index during the month to close at 15.44 percent whereas yield on 182-day bill +12.3% fell to 16.47 percent from 17.19 percent in March. Also, yield on 1-year (YTD Return) treasury note fell by 100 basis points to 18.00 percent. • • • ` April March Change (bps) 91-Day T-Bill 15.44% 17.51% -207bps 182-Day T-Bill 16.47% 17.19% -72bps 1-Yr Note 18.00% 19.00% -100bps www.pentassets.com 050-153-0246 Equity Market The stock market grew considerably during the month of April. The benchmark GSE Composite Index gained 31.12 points (1.7 per cent) to close [the month] at 1,896.13 points, extending year-to-date return to News in Brief 12.3 percent. Market capitalization rose 20.4 percent month-on-month to 58.82 billion cedis (approx. USD 14.05 billion). Overall, the market • • • • • • recorded 13 gainers and 6 losers during the month. UT Bank Limited was Ghana's GDP growth slows to 3.5% in 2016 GSE Composite Index Statistics Ghana's GDP growth in 2016 March Change (%) stood at a provisional figure of 3.5 percent year-on-year, Level 1,896.13 1,865.01 1.7% down from 3.9 percent in Market Cap (GHC mil) 58,822.68 48,846.99 20.4% 2015, according to Ghana YTD Return 12.3% 10.4% Statistical Service. GDP growth for the fourth quarter No. of Gainers 13 6 of 2016 stood at 4.1 percent No. of Losers 6 11 as against 3.9 percent for the same period in 2015. the lead gainer with 50 percent month-on-month appreciation. Other major gainers were CAL Bank Limited, Benso Oil Palm Plantation Limited Government raises over and Trust Bank Limited (THE GAMBIA) with 46.9 percent, 11.0 percent USD2 billion including a and 8.7 percent month-on-month appreciations, respectively. debut 15-year domestic bond Top Gainers (April) The Ministry of Finance Price Gain Change (%) successfully issued 15 and 7 UT Bank Limited 0.06 0.02 50.0% year bonds with the same coupon of 19.75%, raising a 0.72 CAL Bank Limited 0.23 46.9% total amount of USD1.13 Benso Oil Palm Plantation Ltd. 3.22 0.32 11.0% billion. In addition, the Ministry of Finance raised the cedi equivalent of USD1.12 Starwin Products Limited was the worst performer of the month with a billion in 5 and 10 year bonds loss of 33.3 percent. Other major losers were Produce Buying Company via a tap-in arrangement. Limited, HFC Bank Limited and Mechanical Lloyd Company Limited with These activities raised a total of USD2.25 billion and 20 percent month-on-month losses each, respectively. resulted in the lengthening of the maturity profile of the Top Losers (April) instruments available on the Price Loss Change (%) domestic market. This issuance represents the Starwin Products Limited 0.02 -0.01 -33.3% largest amount issued by a Produce Buying Company Ltd. 0.04 -0.01 -20.0% sub-Saharan African country HFC Bank Limited 0.52 -0.13 -20.0% in a day. The pricing obtained was also consistent with the initial price range of 18.95% - Year-to-date (YTD): Performance of the Ghana stock market in 2017, as 19.85%. measured by the benchmark GSE Composite index, stood at 12.3 percent www.pentassets.com 050-153-0246 at close of April with 11 winners and 13 losers. Top winners were UT Bank Limited, Benso Oil Palm Plantation Limited and GCB Bank Limited with 100 percent, 54.8 percent and 46.1 percent year-to-date appreciations, respectively. Top losers were Produce Buying Company Limited, Starwin Products Limited and HFC Bank Limited with 33.3 percent, 33.3 percent Access Bank offers the highest interest rate on and 30.7 percent losses, respectively. bank deposits GSE Top Gainers (Year-to-date) Average interest rate offered by banks on customer Price Gain Change (%) deposits fell by 0.4 percent in GCB Bank Ltd. 5.20 1.64 46.1% March to 11.2 percent, Benso Oil Palm Plantation Ltd 2.9 0.82 39.4% according to the Bank of Ghana. Access Bank Limited UT Bank Ltd. 0.04 0.01 33.3% offered the highest rate (16.4 GSE Top Losers (Year-to-date) percent) followed by Omni Price Loss Change (%) Bank (16 percent) and Bank of CAL Bank Ltd 0.49 -0.26 -34.7% Baroda (15.5 percent). Standard Chartered Bank Tullow Oil Plc (Ghana) 20.94 -5.94 -22.1% Ghana Limited offered the Produce Buying Company 0.05 -0.01 -16.7% lowest interest rate on customer deposits at 3.4 percent. Sources: Bank of Ghana, Ghana Stock Exchange and Ghana Statistical Service. About Us: Banks stop VAT charge Pent Asset and Wealth Management Limited is an investment management and advisory firm. We on financial services are licensed and regulated as an investment advisor and fund manager by the Securities and Exchange Commission of Ghana. Our services broadly include asset management, corporate Financial institutions in finance & advisory, and Research & due diligence. Ghana have stopped charging Disclaimer: 17.5 percent Value Added Tax This report is for general information purposes only and is not intended as a recommendation or (VAT) on all financial services. an offer or solicitation for the purchase or sale of any security. Any person considering an The decision is in pursuant to investment should consider the appropriateness of the investment having regard to their the VAT Amendment Law objectives, financial situation, or needs, and should seek independent advice on the suitability or otherwise of a particular investment. (Act 948, 2017) which scraps VAT on financial service Contact: delivery. James Adjei Barimah Research Analyst Mobile: 050 145 3564 Email: [email protected] www.pentassets.com 050-153-0246 .