Kenya Treasury bonds · auction of 21 September 2020
Kenya bond auction, 21 September 2020: FXD1/2020/015 at 12.512%
The Central Bank of Kenya's bond auction dated 21 September 2020 was a re-opening of FXD1/2011/020, FXD1/2020/015 and FXD2/2010/015.
Bids came to KES 81.7bn against KES 50.0bn on offer (163% subscribed), and the Treasury accepted KES 64.2bn.
FXD1/2011/020 cleared at 11.872%, against a 10.000% coupon, with 10.6 years to maturity. Its previous sale, on 27 June 2011, priced at 14.822%, so the yield is down 295 basis points.
FXD1/2020/015 cleared at 12.512%, against a 12.756% coupon, with 14.4 years to maturity. Its previous sale, on 24 February 2020, priced at 12.756%, so the yield is down 24 basis points.
FXD2/2010/015 cleared at 10.458%, against a 9.000% coupon, with 5.2 years to maturity. Its previous sale, on 25 April 2011, priced at 12.388%, so the yield is down 193 basis points.
What this means for KES 100,000 of FXD1/2020/015
Worked from the published result · information, not advice
KES 5,740 every six months, after tax, for 14.4 years
At this auction KES 100,000 of face value cost about KES 102,568 (price 102.568 per 100), and the yield that implies is 12.51% a year. The coupon is 12.76%: KES 12,756 a year on KES 100,000 of face value, paid in two halves, KES 11,480 after 10% withholding tax.
Held to maturity (2035-02-05), that is about KES 165,016 in coupons, plus KES -2,568 loss between what you paid and the KES 100,000 repaid; roughly KES 162,448 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 |
|---|---|---|---|---|---|---|---|
| FXD1/2011/020 | reopening | 11.872% | 10.000% | 10.6 | KES 14.04bn | KES 7.47bn | 92.277 |
| FXD1/2020/015 | reopening | 12.512% | 12.756% | 14.4 | KES 49.79bn | KES 45.69bn | 102.568 |
| FXD2/2010/015 | reopening | 10.458% | 9.000% | 5.2 | KES 17.84bn | KES 11.02bn | 96.633 |
Source: Central Bank of Kenya result notice · the PDF these figures were read from
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