Kenya Treasury bonds · auction of 19 October 2020
Kenya bond auction, 19 October 2020: FXD1/2018/025 at 13.494%
The Central Bank of Kenya's bond auction dated 19 October 2020 was a re-opening of FXD1/2011/020 and FXD1/2018/025.
Bids came to KES 69.1bn against KES 50.0bn on offer (138% subscribed), and the Treasury accepted KES 60.0bn.
FXD1/2011/020 cleared at 11.990%, against a 10.000% coupon, with 10.5 years to maturity. Its previous sale, on 21 September 2020, priced at 11.872%, so the yield is up 12 basis points.
FXD1/2018/025 cleared at 13.494%, against a 13.400% coupon, with 22.6 years to maturity. Its previous sale, on 23 March 2020, priced at 13.817%, so the yield is down 32 basis points.
What this means for KES 100,000 of FXD1/2018/025
Worked from the published result · information, not advice
KES 6,030 every six months, after tax, for 22.6 years
At this auction KES 100,000 of face value cost about KES 103,671 (price 103.671 per 100), and the yield that implies is 13.49% a year. The coupon is 13.40%: KES 13,400 a year on KES 100,000 of face value, paid in two halves, KES 12,060 after 10% withholding tax.
Held to maturity (2043-05-25), that is about KES 272,502 in coupons, plus KES -3,671 loss between what you paid and the KES 100,000 repaid; roughly KES 268,831 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 | 11.990% | 10.000% | 10.5 | KES 23.16bn | KES 16.99bn | 92.458 |
| FXD1/2018/025 | reopening | 13.494% | 13.400% | 22.6 | KES 45.98bn | KES 43.03bn | 103.671 |
Source: Central Bank of Kenya result notice · the PDF these figures were read from
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