Kenya Treasury bonds · auction of 28 November 2016
Kenya bond auction, 28 November 2016: FXD3/2007/015 at 13.575%
The Central Bank of Kenya's bond auction dated 28 November 2016 was a primary issue of FXD1/2008/020 and FXD3/2007/015.
Bids came to KES 22.9bn against KES 30.0bn on offer (76% subscribed), and the Treasury accepted KES 22.2bn.
FXD1/2008/020 cleared at 14.257%, against a 13.750% coupon, with 19.8 years to maturity. Its previous sale, on 25 July 2016, priced at 14.836%, so the yield is down 58 basis points.
FXD3/2007/015 cleared at 13.575%, against a 12.500% coupon, with 4.8 years to maturity.
What this means for KES 100,000 of FXD3/2007/015
Worked from the published result · information, not advice
KES 5,313 every six months, after tax, for 4.8 years
At this auction KES 100,000 of face value cost about KES 96,167 (price 96.167 per 100), and the yield that implies is 13.57% a year. The coupon is 12.50%: KES 12,500 a year on KES 100,000 of face value, paid in two halves, KES 10,625 after 15% withholding tax.
Held to maturity (2021-09-20), that is about KES 51,111 in coupons, plus KES 3,833 gain between what you paid and the KES 100,000 repaid; roughly KES 54,944 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 | 14.257% | 13.750% | 19.8 | KES 8.40bn | KES 7.88bn | 103.225 |
| FXD3/2007/015 | primary | 13.575% | 12.500% | 4.8 | KES 14.49bn | KES 14.29bn | 96.167 |
Source: Central Bank of Kenya result notice · the PDF these figures were read from
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