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Statement by the Bank of Namibia to explain events delaying the switch auction of 05 August

Statement by the Bank of Namibia to explain events delaying the switch auction of 05 August

“The Bank has noted dissatisfaction from some of our clients regarding developments during the GC21 Switch Auction conducted on 05 August 2020. In light of this, the Bank would like to provide clarification on the matter as follows:

1. The GC21 switch auction was scheduled on the Bloomberg Platform on 05 August 2020, in line with the FY2020/21 Issuance Calendar as well as the subsequent tender invitation and fixed price communicated to market participants.

The auction was initially scheduled to close at 11h00 – this being a switch auction, an additional 30 minutes from the usual closing time of 10h30 was provided. Nonetheless, during the auction (at around 09h30), the auction administrator discovered that market participants are unable to submit bids.

The column with the dropdown menu indicating the destination bonds was missing. The team immediately notified Bloomberg, whose system engineers worked on resolving the problem. In the meantime, the auction administrator notified the market of the technical challenges experienced and pleaded for patience while the team attends to the issue.

Subsequently, the problem was resolved around 11h30 – well over the initial closing time. Due to the time delay, the team extended the auction closing time to 12h30, thus providing market participants with a full hour to refresh their pricing and submit their bids. The delay in the auction and the subsequent extension was purely due to system challenges and not a human error on the part of the administrators at the Bank of Namibia.

2. As communicated to market participants previously, the Bank is hereby reiterating its position on the closing time of Government securities auctions. All normal auctions close at 10h30 on auction date. Due to the volume of work involved, a special dispensation is always provided for special auctions as well as switch auctions, where the closing time is extended to 11h00 on auction date.

Nonetheless, the Bank reserves the right to extend the auction closing time under special circumstances, e.g., in the event of unforeseen delays in starting the auction, due to network related issues, and/or during special auctions and switch auctions. Other than under such exceptional circumstances, the Bank will not extend auction closing times at the request of clients due to complaints received from market participants objecting to such practices.

As communicated in the auction invitations, participants experiencing technical problems with submitting bids on Bloomberg can send their submissions to [email protected], provided that such submission are done ahead of the auction closing time.

3. The Bank, acting on behalf of and under the advisement of the Ministry of Finance, intends to actively manage the Government debt portfolio. The debt switch program is a tool for the Government to restructure the maturity profile of outstanding debt. The Bank reserves the right to switch less than the amount offered, reject and/or make partial allotment in respect of the tenders received.

This implies that there may be a time lag between the auction closing time and the announcement of tender results to the broader market, as the necessary internal consultations are undertaken.

4. The delay and subsequent extension of the GC21 switch auction on 05 August 2020 was unfortunate and regrettable on our end. The Bank would like to assure our clients that we will continuously work closely with the platform vendor to ensure that delays of this nature are minimised going forward. Lastly, the Bank hereby apologises unreservedly for any inconvenience caused to our clients in this regard. The Bank would further like to reiterate its commitment to delivering the best service to all its stakeholders.

5. Any concerns regarding the auction process should be directed to the Investments and Domestic Markets Division at Tel: +264 (61) 283 5222/5001/5006/5163 or Email: [email protected].

Any queries should be directed to:




TELEPHONE: (061) 283 5222/5163/5001/5006

EMAIL: [email protected]

FAX NO: (061) 283 5124

(Statement published verbatim – Ed.)


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