The Central Bank of Kenya(CBK) accepted Treasury Bills worth KSh 22.968 Billion from the Weekly Treasury Bills auction out of KSh 24 Billion, a performance rate of 95.7%
The most attractive instrument was the 364 days Treasury Bills that received bids worth KSh 16.6 Billion out of KSh 10 Billion on offer, a performance rate of 165.95%. The amount accepted was KSh 12.7 Billion.
The 182 days Treasury Bills received bids worth KSh 3.1 Billion out of the KSh 10 Billion on offer, a performance rate of 30.7%. The 91 days Treasury Bill received bids worth KSh 3.2 Billion out of the KSh 4 Billion on offer, a performance rate of 82.57%. The CBK accepted the entire amount.
Competitive bids amounted to KSh 16.7 Billion while non-competitive bids amounted to KSh 2.3 Billion.
What CBK is paying investors
Investors will be paid a rate of return for the 91 days, 182 days and 364 days Treasury Bills at 7.087%, 7,890% and 9.259% at this auction. This is compared to 7.071%, 7.884% and 9.213%, respectively, at the previous auction.
The next Treasury Bills auction will be on 31st March 2021, where KSh 24 Billion worth of Treasury Bills will be offered. This is in consideration of the Easter Holidays.
The CBK is, meanwhile, inviting bids for an 18-year Infrastructure Bond worth KS60 Billion. Proceeds from this Bond will fund infrastructure projects in the 2020/21 budget estimates.
This Bond’s coupon rate is market-determined and will be sold between 26th March and 6th April 2021, with a payment date of 12th April 2021.
The Bond will be tax-free, as is the case for infrastructure bonds as provided under the Income Tax Act.
The Auction date is 7th April 2021, with licensed placing agents being paid a commission at the rate of 0.15% of actual sales (at cost) net of 5% withholding tax.
The CBK will rediscount the Bond as a last resort at 3% above the prevailing market yield or coupon rate, whichever is higher, upon written confirmation to do so from the Nairobi Securities Exchange(NSE).
Secondary trading in multiples of KSh50,000 will commence on Tuesday 13th April 2021.
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