CBK (Central Bank of Kenya) Accepted KSh 47.75 billion out of KSh 68.19 billion in Bids Received at the September Treasury Bonds Auction. Proceeds from this sale is for budgetary support.
According to Results posted on the CBK website, the 15-year re-opened Treasury Bond attracted KSh 57.10Bn in Bids and accounted for most Accepted funds, while demand for the 30-year Bond was weaker.
The re-opened 15-year debt instrument, first sold in 2015 and maturing on July 10th 2034, was offering investors a return of 12.7631% with the state fiscal agent accepting KSh 41.14 billion.
The 30-year Treasury Bond, first sold in 2011 and offering a coupon rate of 13.6937%, drew in KSh 6.61 billion. The State fiscal agent allocated the entire amount raised at the auction as net borrowing by Treasury. The 30-year bond matures on 21st January 1941.
CBK to do a switch bond auction on September 7th
Simultaneously, the fiscal agent has floated a voluntary KSh10 billion Switch Bond Auction as a liability management tool.
The switch allows investors to move out of a 15-year Treasury Bond maturing in February 2028, with a 11.25% coupon into a 10-year bond Treasury Bond maturing in November 2029, with a 12.28% coupon.
The sale period runs through September 7th, 2026, this move helps the CBK avoid major lump-sum payouts and prevents debt rollovers from crowding out new budgetary borrowing.
CBK has maintained its appetite for switch bond auctions even as rating agencies warn that this trend of using the refinancing strategy could send signals of Kenya’s perceived struggle to deal with its debt obligations.
ALSO READ: CBK Seeks KSh60Bn for Budgetary Support in September Treasury Bonds Sale
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