Kenya's bond auction attracts $675.21m

The Central Bank of Kenya. Kenya's bond auction Wednesday attracted bids worth Ksh56.5 billion ($675.21 million), more than double what the Central Bank of Kenya (CBK) was seeking. Photo/FILE  Nation Media Group

By David Mugwe, The EastAfrican

Kenya's Treasury bond auction Wednesday attracted bids worth Ksh56.5 billion ($675.21 million), more than double what the Central Bank of Kenya (CBK) was seeking.

The banking regulator was seeking Ksh25 billion ($298.3 million) through the sale of five and 15-year treasury bonds indicating the debt issue was oversubscribed by more than two times.

The five year bonds are paying interest at 12.892 per cent every six months while and did not offer any discount but the 15 year bonds are paying interest at 12 per cent on the face value every half year and an investor will pay Ksh89,516 ($1,068) for every Ksh100,000 ($1,194).

Investors put in bids worth Ksh33.8 billion ($403.7 million) for the five year bonds and bids worth Ksh22.7 billion ($271.4 million) for the 15 year bonds and the banking regulator accepted a higher percentage of the latter and a higher value of the shorter tenured bonds.

According to the results, CBK took in bids worth Ksh35.8 billion ($427.4 million) of which Ksh20.1 billion ($240.6 million) of the bids were for the five year bond while Ksh15.6 billion ($186.7 million) of the bids were for the 15 year bonds.

The 182-day and 364-day treasury bills also on offer seeking Ksh8 billion ($95.4 million) attracted bids worth Ksh12.5 billion ($149.3 million), the latter being oversubscribed and the former undersubscribed and the interest paid also trended downward for both short-term papers.