The public bond market will soon be operational in Congo. The validation of the operational framework starts Monday, May 20, 2019 at the Central Bank of Congo (BCC). This, pursuant to Decree No. 18/025 of 11 June 2018 setting the terms and conditions for the issue and repayment of treasury bills and bonds of the treasury and the Ministerial Order implementing measures.

After validation, a similar legal framework will be replicated in the provinces to avoid bank loans, which are prohibited by the Finance Act.

Nature of the Securities
Indeed, the aforementioned Decree authorizes the State to issue securities representing public loans called Treasury Bonds and Treasury Bonds. And the Minister of Finance remains the authority authorized to issue these securities in accordance with the Finance Act.

« Treasury Bills are short-term securities with maturities of 3, 6 and 12 months and interest pre-discounted on subscription. Treasury Bonds are medium and long-term securities issued for maturities greater than one year and whose interest is payable annually « , stipulates Article 4 of the Decree.

If both securities are marketable, denominated in Congolese Francs (CDF) or, where applicable, in US Dollars (USD) and have a par value of CDF 100,000 or US $ 10, their repayment is made in one installment at the same time. deadline. Because, their terms and repayment deadline are set at issue by the Minister having Finance in his attributions.

Two Titles, two auctions
According to the Decree, Treasury Bills are issued by multiple rate auctions on the basis of the rates offered by the bidders. Whereas Treasury bonds are issued by means of multi-price auctions on the basis of the prices offered by the bidders.

The convergences are at the level of the interest rate proposed by the bidders, which must be expressed in units with two decimal places, the last of which must be a 0 or a 5.

But also the wording of Article 10 of said Decree which states that: « the amount of the tender is the amount due by the Treasury at the final maturity. It is expressed in hundreds of thousands of Congolese francs with a minimum of 1 million Congolese Francs. It can also be expressed in ten US dollars and must be a multiple of 10 USD with a minimum of 100 USD.  »

Moreover, the two titles can also be subscribed under uncompetitive offers. Their auctions, argues the Decree, are open to all banks whose application to this effect has been accepted by the Ministry of Finance.

Other economic agents have the opportunity to participate in these auctions under the conditions set by the Ministry having finance in its attributions.

« Transactions on the primary and secondary markets of Treasury Bills and Treasury Bonds are liquidated by the SRLCT / BCC. Any natural or legal person may hold Treasury Bills and Treasury Bonds by registration in a securities account with an authorized account holder « , stipulates Article 6 of the same Decree.

Emilie MBOYO