Kenya Treasury bonds · auction of 22 June 2020
Kenya bond auction, 22 June 2020: FXD4/2019/010 at 12.415%
The Central Bank of Kenya's bond auction dated 22 June 2020 was a re-opening of FXD3/2019/005 and FXD4/2019/010.
Bids came to KES 105.1bn against KES 40.0bn on offer (263% subscribed), and the Treasury accepted KES 49.3bn.
FXD3/2019/005 cleared at 11.186%, against a 11.492% coupon, with 4.5 years to maturity. Its previous sale, on 23 December 2019, priced at 11.492%, so the yield is down 31 basis points.
FXD4/2019/010 cleared at 12.415%, against a 12.280% coupon, with 9.4 years to maturity. Its previous sale, on 25 November 2019, priced at 12.280%, so the yield is up 13 basis points.
What this means for KES 100,000 of FXD4/2019/010
Worked from the published result · information, not advice
KES 5,219 every six months, after tax, for 9.4 years
At this auction KES 100,000 of face value cost about KES 100,183 (price 100.183 per 100), and the yield that implies is 12.41% a year. The coupon is 12.28%: KES 12,280 a year on KES 100,000 of face value, paid in two halves, KES 10,438 after 15% withholding tax.
Held to maturity (2029-11-12), that is about KES 98,021 in coupons, plus KES -183 loss between what you paid and the KES 100,000 repaid; roughly KES 97,838 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 |
|---|---|---|---|---|---|---|---|
| FXD3/2019/005 | reopening | 11.186% | 11.492% | 4.5 | KES 60.89bn | KES 16.53bn | 101.271 |
| FXD4/2019/010 | reopening | 12.415% | 12.280% | 9.4 | KES 44.25bn | KES 32.80bn | 100.183 |
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.