The corporate bonds market in Kenya is showing clear signs of resurgence, evidenced by the oversubscription of two major issuances by East African Breweries Limited (EABL) and Safaricom Plc.
The two corporates returned to the fixed-income market in the third quarter of 2025, ending a four-year drought without any corporate bond issuance in Kenya’s capital markets. Both offers attracted overwhelming demand from retail and institutional investors, underscoring renewed confidence in corporate bonds.
EABL recorded a successful bond issuance in the first tranche of its Medium-Term Note (MTN) programme, raising KES 16.76 billion against a target of KES 11 billion, an overall subscription rate of 152.4%. To meet the excess demand, the brewer activated the greenshoe option following approval from the Capital Markets Authority (CMA). The five-year note, paying 11.80% per annum, appealed to investors seeking stable income from a well-rated issuer.
Safaricom’s Green Bond generated even stronger interest, receiving applications totalling KES 41.6 billion against a target of KES 15 billion, achieving an oversubscription of 175.7%. The telecommunications company exercised the full KES 5 billion greenshoe option, bringing the total allocations for the tranche to KES 20 billion, in line with the maximum amount approved under the first tranche.
Investors’ Appetite for Corporate Bonds
Investors’ renewed appetite for corporate bonds has been driven by several factors, including lower interest rates in government securities, attractive terms and investor-friendly structures, and the strong balance sheets and creditworthiness of issuers. Continuous interest rate cuts by the Central Bank of Kenya (CBK) have pushed yields on government papers downward. The CBK’s Monetary Policy Committee (MPC) has cut the benchmark rate nine consecutive times to 9.00% as of December 10, from 13.00% in August 2024, representing a cumulative 400 bps reduction. Consequently, yields on government securities have nearly halved compared to last year.
Low minimum investment thresholds, combined with semi-annual interest payments, have further spurred investor interest. Safaricom’s tax-free coupon offered both a compelling yield and strong sustainability appeal. Both EABL and Safaricom have robust cash flows, clear debt-servicing capacity, and strong credit profiles. Investors are more comfortable committing funds to corporates whose financials are transparent and whose market positions are highly defensible.
Also Read: Safaricom Green Notes Receives KES 41.6B bids, recording 175% Oversubscription
