Treasury off the mark in year-ending bond sale, raises Ksh.19.6B

The National Treasury has failed to meet its target of raising Ksh.25 billion from the 2021-22 year ending tap sale whose auction closed on Thursday.

The exchequer has instead tapped just Ksh.19.6 billion representing a 78.4 per cent rate of performance for the issue.

Subsequently, the Central Bank of Kenya (CBK) has taken all proceeds from the issue ahead of the winding up of the current fiscal year on June 30.

Investor bids for the bond sale were concentrated on the longer dated, re-opened 15 year issue with total bids at Ksh.16 billion.

The paper offered the higher yield at 13.942 per cent in contrast to the re-opened three year paper that has an 11.766 coupon rate.

The sub-par performance of the tap-sale which followed a modest uptake in June’s infrastructure bond is expected to leave the National Treasury slightly below its local borrowing program for the ending fiscal year.

Data from the National Treasury shows the government had a gross-domestic borrowing target of Ksh.1.007 trillion for the lapsing 2021-22 cycle.