Treasury building in Nairobi. [Photo/businessdaily]
The Treasury has returned to the market with a new five-year bond issue.
The new issue is targeting to raise Sh30 billion, buoyed by improved subscription rate of bonds during the third quarter of 2017.
The Central Bank of Kenya (CBK) on Friday announced the October bond issue whose sale will run until October 17.
During the third quarter of the year, CBK acting in its capacity as a fiscal agent for the government, offered five Treasury bonds which were distributed cross the three months.
The acceptance rate on Treasury bonds improved gradually in the third quarter, closing at 71.3 per cent for the September offer, up from 27.3 per cent in July, as the market adjusted to CBK’s efforts to maintain the rates at low levels.
The 10-year bond issue was re-opened twice in the quarter as the first auction recorded subscription of 71.3 per cent with the market average rate for the bids coming in at 13.3 per cent, 30 basis points above the accepted rate of 13 per cent.
The average subscription rate for bonds in third quarter came in at 102 per cent, attributable to the high liquidity in the money market.