The Central Bank of Kenya (CBK) has collected Ksh189.1 billion from the domestic market in August through treasury bills and treasury bonds. However, the month saw subdued investor appetite for government securities due to falling yields.
In the month, CBK floated two treasury bonds seeking to collect Ksh110 billion. Treasury bond FXD2/2018/20 sought Ksh40 billion with a 20-year tenure and a fixed coupon rate of 13.2 percent. CBK accepted bids worth Ksh41 billion from this auction on August 4.
The IFB1/2020/11 amortized infrastructure bond sought to raise Ksh70 billion and had an 11-year tenure. The bond was tax-free as is the case for infrastructure bonds with a coupon rate of 10.9 percent. On August 19, CBK received bid amounting to Ksh101.5 billion representing a 144.96 percent performance rate. CBK accepted bid worth Ksh78.6 billion.
Treasury bills are the most commonly used tool in the month as CBK floated four bills seeking to raise ksh96 billion.
The month saw reduced investor appetite for treasury bills as the average interest rate for the 91 day was 6.2%, 181 days was 6.6%, while the 364 days bill averaged 7.5%. Cumulatively, CBK collected Ksh69.5 billion from the four treasury bill auctions. Treasury bill auction on August 6 raised the highest amount at Ksh30.5 billion while the auction on August 20 collected a paltry Ksh9.7 billion.
T. Bonds and T.Bills auctioned in August
- August 4 – T.bond auction raises Ksh41 billion
- August 6 – T.bill auction raises Ksh30.5 billion
- August 13 – T.bill auction raises Ksh18.6 billion
- August 19 – T.bond auction raises Ksh78.6 billion
- August 20 – T.bill auction raises Ksh9.7 billion
- August 27 – T.bill auction raises Ksh10.7 billion