Kenya Treasury bonds · auction of 25 July 2016
Kenya bond auction, 25 July 2016: FXD2/2016/005 at 14.069%
The Central Bank of Kenya's bond auction dated 25 July 2016 was a primary issue of FXD1/2008/020 and FXD2/2016/005.
Bids came to KES 40.9bn against KES 30.0bn on offer (136% subscribed), and the Treasury accepted KES 33.5bn.
FXD1/2008/020 cleared at 14.836%, against a 13.750% coupon, with 11.9 years to maturity.
FXD2/2016/005 cleared at 14.069%, against a 14.069% coupon, with 5.0 years to maturity.
What this means for KES 100,000 of FXD2/2016/005
Worked from the published result · information, not advice
KES 5,979 every six months, after tax, for 5.0 years
At this auction KES 100,000 of face value cost about KES 100,000 (price 100.000 per 100), and the yield that implies is 14.07% a year. The coupon is 14.07%: KES 14,069 a year on KES 100,000 of face value, paid in two halves, KES 11,959 after 15% withholding tax.
Held to maturity (2021-07-19), that is about KES 59,589 in coupons, plus KES 0 gain between what you paid and the KES 100,000 repaid; roughly KES 59,589 in all after tax.
Sold before maturity, the price moves with rates: if yields rise, the bond is worth less; if they fall, more. The Central Bank’s minimum bid is KES 50,000. Compare with bills, funds and deposits after tax →
Results
By bond
| Bond | Sale | Yield | Coupon | Years left | Bids | Accepted | Price /100 |
|---|---|---|---|---|---|---|---|
| FXD1/2008/020 | primary | 14.836% | 13.750% | 11.9 | KES 14.72bn | KES 9.10bn | 95.297 |
| FXD2/2016/005 | primary | 14.069% | 14.069% | 5.0 | KES 26.15bn | KES 24.40bn | 100.000 |
Source: Central Bank of Kenya result notice · the PDF these figures were read from
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