Kenya Treasury bonds · auction of 17 June 2019
Kenya bond auction, 17 June 2019: FXD1/2012/015 at 11.593%
The Central Bank of Kenya's bond auction dated 17 June 2019 was a re-opening of FXD1/2012/015 and FXD1/2018/015.
Bids came to KES 85.6bn against KES 40.0bn on offer (214% subscribed), and the Treasury accepted KES 38.9bn.
FXD1/2012/015 cleared at 11.593%, against a 11.000% coupon, with 8.2 years to maturity. Its previous sale, on 20 June 2016, priced at 14.335%, so the yield is down 274 basis points.
FXD1/2018/015 cleared at 12.456%, against a 12.650% coupon, with 13.9 years to maturity. Its previous sale, on 28 May 2018, priced at 13.078%, so the yield is down 62 basis points.
What this means for KES 100,000 of FXD1/2012/015
Worked from the published result · information, not advice
KES 4,675 every six months, after tax, for 8.2 years
At this auction KES 100,000 of face value cost about KES 99,615 (price 99.615 per 100), and the yield that implies is 11.59% a year. The coupon is 11.00%: KES 11,000 a year on KES 100,000 of face value, paid in two halves, KES 9,350 after 15% withholding tax.
Held to maturity (2027-09-06), that is about KES 76,874 in coupons, plus KES 385 gain between what you paid and the KES 100,000 repaid; roughly KES 77,259 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 |
|---|---|---|---|---|---|---|---|
| FXD1/2012/015 | reopening | 11.593% | 11.000% | 8.2 | KES 39.77bn | KES 21.21bn | 99.615 |
| FXD1/2018/015 | reopening | 12.456% | 12.650% | 13.9 | KES 45.85bn | KES 17.73bn | 101.979 |
Source: Central Bank of Kenya result notice · the PDF these figures were read from
Free, every weekday at 7:00
The Afronomics Morning
Every Monday: the week's auctions, currencies and the stories that moved African markets. Free.