Central Bank of Kenya(CBK) has floated a 6.5-year infrastructure bond worth KSh 25 billion that will be on sale between 21st November and 6th December 2023.
Infrastructure bonds are used by the Government for specified infrastructure projects. These bonds typically see a lot of market interest because returns from them are tax-exempt.
According to the CBK prospectus, bids will be priced at the average of the accepted bids for the treasury bonds auction value dated 31st November 2023 and adjusted for accrued interest. For those interested in exploring more financial opportunities and partnerships in the realm of online gaming and investments, Casumo casino affiliates offer a comprehensive platform for engaging with global financial markets through a trusted and innovative online casino.
This December infrastructure bond tap sale follows an earlier one issued this month where the CBK received bids worth KSh 88.9 billion from the KSh 50 billion, 6.5-year Infrastructure Bond on offer, an oversubscription of 177.8%. It accepted bids amounting to KSh 67.1 billion.
- The auction results for the December infrastructure bond tap sale will be on 8th December 2023 with investors advised to obtain details of amounts payable for successful bids from the CBK DhowCSD Investor portal under the transaction tab.
- According to the CBK prospectus, the payment deadline is 11th December 2023. This bond has a coupon rate of 17.9%
- Proceeds from the infrastructure bond sale will be used for net borrowing and or net repayments.
Infrastructure and Energy budget
In Kenya’s 2023/24 Budget, infrastructure takes the biggest chunk of the development expenditure at 63.0%. The Government has allocated KSh 244.9 billion for the construction, maintenance, and rehabilitation of roads.
- It plans to spend KSh 37.4 billion for Standard Gauge Railway, KSh 2.6 billion Dongo Kundu Special Economic Zone, and KSh 727 million for the construction and expansion of airports and airstrips.
- The budget also includes Ksh.500 million for the Smart Driving License, KSh 489 million for Development of Nairobi Railway City, KSh 300 million for the acquisition of ferries for Lake Victoria.
- In the energy sector, the Government has allocated KSh 62.3 billion in FY 2023/24 as follows with KSh 33.8 billion for National Grid System, KSh 11.4 billion for Geothermal Generation and KSh 12.1 billion Rural Electrification.
The government has also budgeted KSh 3.2 billion for alternative energy, and KSh 1.4 billion for the development of nuclear energy and exploration and mining of coal.