The Central Bank of Kenya (CBK) has successfully raised KES 60.99 billion through the re-opening of two long-term Treasury bonds, exceeding its initial target of KES 60 billion. The auction was concluded on March 11, 2026, and it saw intense investor interest, resulting in an overall performance rate of 195.72%.
Investors flooded the auction with bids totaling KES 117.43 billion at cost, nearly doubling the government’s requirements. The Central Bank opted to accept KES 60.99 billion, maintaining a disciplined bid-to-cover ratio of 1.93. The participation mix for the accepted bids included competitive bids of KES 37.50 billion and non-competitive bids of KES 23.49 billion.
Performance Breakdown by Bond Issuance
The auction featured two distinct tenors, with the 25-year paper attracting the highest volume of bids. FXD1/2019/020 (20-Year): This bond, which has 13.1 years remaining to maturity, received bids worth KES 50.5 billion, reflecting a performance rate of 84.16%. . The CBK accepted KES 44.85 billion. The bond carries a fixed coupon rate of 12.8730% and was priced at 106.4618 per KES 100 at the average yield.
FXD1/2021/025 (25-Year): This bond has 20.1 years remaining to maturity, was the primary driver of the auction’s oversubscription, receiving KES 66.94 billion in bids, representing a performance rate of 111.56%. However, the CBK was highly selective, accepting only KES 16.14 billion. It carries a coupon rate of 13.9240% and achieved a price of 111.9727 per KES 100 at the average yield.
The proceeds from this auction are earmarked for budgetary support for the Republic of Kenya. Successful bidders are expected to settle their payments by the value date of Monday, March 16, 2026. The reopened bond will continue to trade in the secondary market on the Nairobi Securities Exchange in multiples of KES 50,000.
This robust performance comes at a time when the government is transitioning from fiscal stabilization to scaled-up investment as outlined in the 2026 Budget Policy Statement. The high subscription rates shows continued investor confidence in long-term government debt instruments, despite broader macroeconomic challenges in the country.
Investors are reminded that these securities can be pledged as collateral for loans from regulated financial institutions and qualify for statutory liquidity ratio requirements for commercial banks. The CBK also provides rediscounting as a last resort, set at 3% above the prevailing market yield or coupon rate.
