Treasury Bonds Tap Sale in September: CBK Seeking Ksh35B

This September, the Central Bank of Kenya will reopen its 2-year and 10-year Treasury Bond tap sales with a KSh 35 billion price target.

The CBK prospectus states that the funds are needed for budgetary support.

The 2-year and 10-year treasury bonds have coupon rates of 16.97% and 15.04%, respectively, and investors must make a minimum bid of KSh 50,000.

When the bids are closed and the auction is over on September 13, 2023, these fixed-coupon Treasury bonds will no longer be available for purchase.

Investors should contact the DhowCSD on Friday, September 15, 2023, for information regarding the payments due for winning bids. An individual transaction reference will be included in the outcomes for payment. A commission in the amount of 0.15% of actual sales (at cost), less a 5% withholding tax, will be paid to licensed placing agents.

Upon written approval from the Nairobi Securities Exchange, the CBK will rediscount the notes as a last resort at 3% over the current market yield or coupon rate, whichever is higher.

The only qualified investors are those who have open CSD Accounts with the Central Bank of Kenya. These T-Bonds could be opened again in the future. On Monday, September 18, 2023, secondary trading in multiples of KSh 50,000.00 will start.