Treasury picks Sh5bn from oversubscribed infrastructure bond

The National Treasury building in Nairobi. FILE PHOTO | NMG 

By GEOFFREY IRUNGU

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Summary

• The government was seeking Sh40 billion in a 15-year bond and was offering to pay investors 12.5 per cent as a coupon (interest) annually.
• The subscription of Sh55.756 billion was a 139.39 per cent performance rate – well beyond the amounts sought.

The National Treasury has picked only Sh5 billion out of a possible Sh55.8 billion that investors subscribed for in an infrastructure bond floated last week.

In a statement announcing the results of the auction, Central Bank of Kenya acting director for financial markets, John Birech, said that the new borrowing by the Treasury would be only Sh5.04 billion.

The government was seeking Sh40 billion in a 15-year bond and was offering to pay investors 12.5 per cent as a coupon (interest) annually.

The subscription of Sh55.756 billion was a 139.39 per cent performance rate – well beyond the amounts sought.