Government of Jamaica Jamaica Debt Exchange (“JDX”) Individual Investor Presentation January 19, 2010

Government of JamaicaGovernment of Jamaicazx

Jamaica Debt Exchange (“JDX”)

Individual Investor Presentation January 19, 2010


2

Pamella McLaren

– Senior Director Debt Management – Ministry of Finance and the Public Service

Representative


Introduction


4

87% 89%

117%

122% 124% 123%120%

117%114%

124%

137%

80%

90%

100%

110%

120%

130%

140%

150%

1999/00

2000/01

2001/02

2002/03

2003/04

2004/05

2005/06

2006/07

2007/08

2008/09

E2009/10

Tot

al D

ebt/

GD

P (

%)

High Levels of Debt

Interest as % of Tax RevenuesDebt / GDP

57.0%

50.3%

47.6%

50.3%

65.1%

40.0%

45.0%

50.0%

55.0%

60.0%

65.0%

70.0%

2005/06 2006/07 2007/08 2008/09 E2009/10In

tere

st a

s %

of T

ax


5

Programme Framework

EconomicProgramme

Fiscal Reform

MultilateralFinancial Support and Monitoring

Jamaica Debt Exchange

(JDX)


6

Debt Dynamics at a Fork in the Road

Jamaica (B

+)

Turkey (B

-)

Brazil (B

+)

Uruguay

Pakistan (B

)

Ukraine (B

)

Median for B

s

Belize (B

+)

Turkey (B

-)

Jamaica (B

+)

Pakistan (B

)

Brazil (B

+)

Uruguay

Median for B

s

Belize (B

+)

Ukraine (B

)

Source: IMF, excludes IMF debt

100

110

120

130

140

150

160

2004/052005/062006/072007/082008/09E2009/10F2010/11F2011/12F2012/13F2013/14

Tot

al D

ebt/

GD

P (

%)

Active

Passive

Historical


7

Par for Par

J$ 100 Old Notes J$ 100 New Notes

+

Accrued Interest

New Bonds:

- Longer Maturity

- Lower Coupon

- New Features: Fixed Rate Non-Call Life & CPI Bonds


8

Choices for All Investors, Subject to Maturity Rules

Variable Rate “VR”

Fixed Rates “FR”

USD

New Fixed Rate3-Months to 30 Years

New Variable Rate1.5 Years to 22 Years

Inflation Indexed12 Year and 20 Year

New USD3, 4 & 6 Year

Old Notes New Notes

Up to:10

Choices

Up to:21

Choices

Up to:3

Choices


9

How do I know which bonds I can choose?

1) Start with type of Old Note – and check the maturity table

2) If Fixed Rate Bond (“FR”) look at the maturity of your bond,

example 15.75% due August 24 2011 (about 1.5 Years).

3) Look on Table 2 on page 10 of the document for the row

corresponding to this maturity range.

You will only have 3 choices in this case:

Fixed Rate 4-Year Bond with 12.50% coupon due 2014



ALL CHOICES NON-CALL LIFE


10

Single-Choice “Retail” Window, J$ 5MM or less

Variable Rate “VR”

Fixed Rates “FR”

USD

FR

VR

USD

Coupons: 12.25%

Tenors: 3 Years

Structure: Not Callable

Spread: 1 Month T Bill + 1.0%

Fixed Period

11.75% for 3 Months

Tenors: 3.5 Years

Coupon: 6.75%

Tenor: 3 Year

Old Notes New Notes

1 Choice

1 Choice

1 Choice


11

Submission Forms for Your Old Bond

USD Old Bonds – Blue

Fixed Rate Old Bonds –Yellow

Variable Rate Old Bonds - Green

Data Required:

- Name, TRN

- Contact Information

- Note Series Name, Maturity

- Certificate Number and Amount

- Delivery Information


12

Submitting an Offer

You can submit yourself – or submit through your broker

Eligible Investors: Jamaican Residents

Valid Submission: Submission Form + Note Certificate

Submission Form: Selection of New Bonds + Other Info

1 – 10 Certificates

10+ Certificates

Use Physical Offer Submission Form

Deliver to Bank of Jamaica

Use Electronic Offer Submission Form

Deliver to Ministry of Finance


13

Delivering Certificates

Delivering Old Certificates to the Government of

Jamaica:

Required for all submissions

Receiving New Certificates from the Government of

Jamaica:

This can be to your home or to the care of your broker


14

Transaction Processing Timeline

• Cancellation of Old Bonds• Credit for New Bonds

January 14, 2010

Launch Date

January 26, 2010

Expiration Date

February 16, 2010

Settlement Date

Registration& Certificate

Delivery


15

Transaction Information Ministry of Finance and the Public Service

www.mof.gov.jm Information Memorandum Investor Presentation Press Releases Certificate submission forms and instructions Electronic submission spreadsheet Q&A Clarifications and amendments

Bank of Jamaica

www.boj.org.jm


16

New Benchmark Bonds

Maturity Yield

3 Month 11.00%

6 Month 11.25%

1 Year 11.75%

2 Year 12.00%

3 Year 12.25%

4 Year 12.50%

6 Year 12.625%

9 Year 12.75%

14 Year 12.875%

30 Year 13.25%

Maturity Real Rate

12 Year 2% step to 4.00%

20 Year 2% step to 4.25%

Maturity* Margin Index / Pay Initial Fix Initial Fix Period

1.5 Year 1.0% 1 Month 11.75% 3 Month

2.5 Year 1.0% 1 Month 11.75% 3 Month

3.5 Year 1.0% 1 Month 11.75% 3 Month

5 Year 1.25% 3 Month 11.75% 6 Month

7 Year 1.375% 3 Month 11.75% 6 Month

8 Year 1.375% 3 Month 11.75% 6 Month

10 Year 1.50% 3 Month 11.75% 1 Year

16 Year 1.50% 3 Month 11.75% 1 Year

22 Year 1.50% 3 Month 11.75% 1 Year

Maturity Yield

3 Year 6.75%

4 Year 7.00%

6 Year 7.25%

Fixed Rate Variable Rate

USD CPI* Variable bonds are callable after certain dates

Fixed Rate, USD, and CPI bonds are not callable


17

Example Allocation Rules by Maturity – Table 2

Example New Bond Election Options for Fixed Rate Bonds:

GroupMaturity Range of Old Notes

Short FR Package*

3Y Fixed 4Y Fixed 6Y Fixed 9Y Fixed14Y

Fixed30Y

Fixed

FR-A 2/17/2010 - 12/31/2010

x x x x x

FR-B 12/31/2010 – 6/30/2011

x x x x

FR-C 6/30/2011 – 12/31/2012

x x x

FR-D 12/31/2012 – 12/31/2014

x x

FR-E 12/31/2014 – 12/31/2017

x

FR-14 12/31/2017 - 12/31/ 2024

x

FR-30 After: 12/31/2024 x xFull “lookup” list will be posted on the website with all choices by each bond. If you have any doubt please call your broker or the Ministry of Finance.


18

$100

$0

$40

$80

$120

2023 2024 2025

Reallocation Rules – Summarized in Table 1

$50bn cap

Reallocation Option ExercisedHypothetical Elections

The government may exercise its reallocations in the amortization profile if it exceeds the $50bn cap

Example above: 14Y FR can be split into 3 bonds with the same coupons– 30% New Fixed Rate 13.0Y

– 40% New Fixed Rate 14.0Y

– 30% New Fixed Rate 15.0Y

$30$40

$30

$0

$40

$80

$120

2023 2024 2025


19

Questions & Answers

Documents

Government of Jamaica Jamaica Debt Exchange (“JDX”) Individual Investor Presentation January 19, 2010