By: Nghiinomenwa-vali Hangala
On Wednesday this week, the Ministry of Finance, through the Bank of Namibia, will give a chance to various investors (individuals and institutions) to switch their N$6.6 billion investment in the GC27 Bond.
According to the Tender Switch Auction Invitation, market participants are invited to bid the nominal amounts of the GC27 they wish to sell for destination stocks and the yield/price at which they wish to buy the destination stock.
Allocation will be made in ascending order of switch ratios (GC27 dirty prices divided by GC29, GC34, GC35, GC37, GC40, GC43, GC45, GC48, GC50, and GC53 dirty prices).
The Bank of Namibia will fix the GC27 switch yield and thus the dirty price.
Today, around 15h00, the Bank of Namibia will announce the fixed yield for the GC27.
This invite is a platform for investors to move their money to the indicated long-dated bonds at a certain interest rate that suits both the government and investors.
As of the end of April 2026, the government of Namibia has borrowed/owes N$6.6 billion through the GC27, which it is supposed to pay back next year as the bond matures.
To avoid paying large amounts, which drain liquidity, the government employs the strategy of switching auctions by giving investors who have long-term investment objectives the opportunity to move their money to long-term dated bonds.
The borrowing calendar continues to include switch auctions, allowing bondholders to exchange holdings of shorter-dated source bonds for longer-dated destination instruments monthly.
For FY2026/27, the switch auction programme transitions to the GC27 bond (8.00 percent coupon, maturing 15 January 2027).
According to the Borrowing Strategy, the switch programme is complementary to, and not a substitute for, the regular fixed-rate bond auction programme.
Regular bond auctions will proceed as per the standard schedule in certain weeks when no switch auction is scheduled.
After the 20 May GC27 Switch, two more switches are planned in June and July 2026.
During FY2025/26, the Government conducted nine switch auctions targeting the GC26 bond (8.50 percent coupon, maturing 15 April 2026).
At the commencement of the switching activity, the GC26 had an outstanding balance of approximately N$6.4 billion.
Through the nine switch auctions conducted during the year, the outstanding was reduced by 73.2 percent to N$1.7 billion by the end of February 2026.
