The Central Bank of Kenya(CBK) has floated two 15-year and 25-year fixed coupon Treasury Bonds as it seeks to collect KSh 60 Billion in October.
According to the prospectus posted on the CBK website, the two re-opened 15 year Treasury Bonds were first sold in 2013 and 2019 while the 25-year Fixed-Coupon Treasury Bonds are new.
The purpose of these Treasury Bonds is to provide budgetary support and the period of sale is between 21st September 2021 and 5th October 2021.
The coupon rate for the two 15-year Treasury Bonds is 11.250% and 12.340% respectively while the 25 year Treasury Bonds will have a coupon rate of 13.924%.
Duly completed bond application forms must be submitted to any branch of the CBK by 5th October 2021 while the auction will take place on 6th October 2021.
Licensed placing agents will be paid a commission of 0.15% of actual sales net of 5% withholding tax.
The CBK will rediscount the bonds as a last resort at 3% above the prevailing market yield or coupon rate whichever is higher, upon written permission to do so from the Nairobi Securities Exchange(NSE).
Secondary trading of the bonds, in multiples of KSh 50,000 will commence on 12th October 2021.