The Central Bank of Kenya (CBK) has raised KSh 61.44 billion from the reopening of two long-dated Treasury bonds, reversing a weak start to its September bond sale programme.
- •The 20-year FXD1/2018/020 and the 25-year FXD1/2022/025 attracted a combined KSh 97.29 billion in bids against a KSh 40 billion offer, a performance rate of 243.2 percent.
- •CBK accepted KSh 23.51 billion and KSh 37.93 billion respectively, and settled the bonds on September 22.
- •The 20-year bond cleared at a weighted average accepted rate of 13.58%, while the 25-year bond priced at 14.14%.
Both cleared below their market-weighted average rates of 13.72% and 14.25%, showing strong investor demand for long-dated government debt.
| Metric | FXD1/2018/020 (20-year) | FXD1/2022/025 (25-year) |
|---|---|---|
| Bids Received | KSh 33.38Bn | KSh 63.91Bn |
| Accepted | KSh 23.51Bn | KSh 37.93Bn |
| Performance | 83.44% | 159.77% |
| WAR | 13.58% | 14.14% |
| MWAR | 13.72% | 14.25% |
| Coupon | 13.20% | 14.19% |
Weak First Leg: 30-Year Bond Falters
The strong uptake followed a weak showing in the first leg of the programme. On September 3, CBK raised only KSh 2.40 billion from the reopening of the 30-year Savings Development Bond (SDB1/2011/030) despite offering KSh 20 billion.
Investors submitted KSh 8.07 billion in bids, a performance rate of 40.35%. CBK rejected most bids as investors sought higher yields.
| Bond | Bids Received | Accepted | Performance | WAR | MWAR | Coupon |
| SDB1/2011/030 (30-year) | KSh 8.07Bn | KSh 2.40Bn | 40.35% | 13.96% | 14.37% | 12.00% |
CBK lined up the three reopenings to raise KSh 60 billion in September for budgetary support and to manage upcoming redemptions. The rebound in demand for the 20- and 25-year bonds shows investors prefer shorter long-dated maturities over the ultra-long 30-year tenor.
