Treasury Seeks Additional Ksh 25B to Hit Local Borrowing Target

The National Treasury is seeking an additional Ksh 25 billion from the domestic credit market in order to meet its borrowing target for the 2021/22 fiscal year.

The Treasury’s primary fiscal agent, the Central Bank of Kenya (CBK), has put out a prospectus for a tap sale on two Treasury bonds issued in April 2022, that is expected to run until June 23, 2022.

The bonds include a 3-year paper that features an 11.766% coupon rate and a longer dated 15-year paper with a 13.942% per coupon.

The latter is expected to see higher investor bids based on its attractive return and had greater yields during April’s primary auction compared to the 3-year paper.

The 3-year paper on the other hand, underperformed in its primary issue attracting birds with Ksh 34 billion to fall shy of the Ksh 40 billion target from the sale.

The CBK opted for a tap sale on April Treasury bonds and not the recently closed June infrastructure which yielded Ks73.8 billion in proceeds earlier this month.

The bond was slightly overscribed with Ksh 76.4 billion in total investor bids against the Ksh 75 billion target.