Broke govt gets Ksh60bn loan from international financiers

It’s a sigh of relief after the government, which is reeling under a cash crunch caused by low tax collections, signed up a loan from international financiers to plug its budget deficit. 

The $600 million (Ksh60 billion) loan has been arranged by Citi, Standard Bank and Standard Chartered Bank.

A statement from public relations firm H&K Strategies says the three banks are also the bookrunners, or simply main underwriters of the loan. The syndicated loan, a medium term loan facility  for the Government of the Republic of Kenya, will be channelled through the National Treasury.

“The Facility, which has a two year tenor, has been fully underwritten by the Bookrunners, and was launched into general syndication to international financial institutions on Thursday, 29th October 2015,” says the statement.

The is the National Treasury’s second international syndicated loan financing. The proceeds from the facility will be used to fund costs approved by Parliament in the Fiscal Year 2015/16, including infrastructure development projects in the road, energy, agriculture and water sectors.

The statement does not state repayment terms.

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