The Central Bank of Kenya (CBK) has invited bids for the re-opening of two benchmark fixed coupon Treasury Bonds scheduled for June 2026. The government is seeking to raise KES 40 billion through this auction to provide budgetary support.
CBK Offered Bonds and Key Features
The auction features two long-term instruments with established fixed coupon rates:
- 15-Year Bond (FXD1/2020/015): This bond currently has 8.7 years remaining to maturity, carrying a coupon rate of 12.7560%. It is set to mature on February 5, 2035.
- 25-Year Bond (FXD1/2018/025): This instrument has 17.1 years remaining to maturity with a coupon rate of 13.4000%. Its final maturity date is May 25, 2043.
The sale period for these bonds is brief, running from May 29, 2026, to June 3, 2026. Bidders must submit their applications by the deadline of 10:00 am on Wednesday, June 3, 2026, which is also the scheduled auction date. Successful bids will be settled on Monday, June 8, 2026.
The CBK provided detailed pricing tables to guide investors on clean prices based on various yields to maturity (YTM). For the 15-year bond, a YTM of 12.7500% corresponds to a clean price of 99.9843. For the 25-year bond, a YTM of 13.3750% results in a clean price of 100.1582.
To facilitate investor exit strategies, these bonds will be listed on the Nairobi Securities Exchange (NSE). Secondary trading, conducted in multiples of KES 50,000.00, is slated to begin on June 8, 2026.
The bonds offer high liquidity features:
- Statutory Requirements: They qualify for the statutory liquidity ratio requirements for commercial banks and non-bank financial institutions.
- Collateral: Investors may pledge these securities as collateral to obtain loans from regulated financial institutions.
- Rediscounting: As a last resort, the CBK provides a rediscounting facility at a rate of 3% above the prevailing market yield or coupon rate, whichever is higher.
Also read: Express Kenya to Offer 50 Million New Shares in Proposed Rights Issue
