Kenya’s Central Bank on Tuesday raised Ksh100.5 billion in a heavily oversubscribed treasury bond auction, as investors rushed to lock in double-digit returns on two reopened long-dated government securities, underscoring robust appetite for Kenyan sovereign debt amid an evolving monetary policy environment.
The Central Bank of Kenya (CBK) had advertised a target of Ksh50 billion for the Feb. 11 auction. Total bids received reached Ksh213.7 billion — more than four times that figure — prompting authorities to accept twice the original offer, according to results published on the CBK’s official channels.
“Results for Reopened Fifteen- and Twenty-Five-Year Treasury Bonds Issue Nos. FXD3/2019/015 and FXD1/2018/025 Dated 16/02/2026.”
— Central Bank of Kenya, Official Statement
Fifteen-Year Bond Draws Overwhelming Response
The 15-year bond (ISIN KE6000001328), maturing July 10, 2034, drew Ksh133.8 billion in bids, equivalent to a performance rate of 267.59 percent against the allotted amount. The CBK accepted Ksh54.8 billion in total — Ksh33.7 billion in competitive bids and Ksh21.1 billion in non-competitive bids — producing a bid-to-cover ratio of 2.44, meaning demand outpaced supply by a wide margin.
Accepted bids on the 15-year paper cleared at a weighted average rate of 12.1835 percent, marginally below the market weighted average of 12.3876 percent, with the bond priced at Ksh101.7358 per Ksh100 face value. The bond retains its original coupon rate of 12.34 percent.
Long-Term Bond Demand Remains Strong
The 25-year bond (ISIN KE5000068549), maturing May 25, 2043, with 17.3 years remaining, attracted Ksh79.9 billion in bids at a performance rate of 159.89 percent. The CBK accepted Ksh45.7 billion — split between Ksh36.0 billion in competitive bids and Ksh9.7 billion in non-competitive bids — yielding a bid-to-cover ratio of 1.75.
Accepted bids on the longer-duration paper cleared at a weighted average rate of 13.3621 percent, slightly below the market average of 13.4496 percent. The bond was priced at Ksh102.5321 per Ksh100 face value, carrying its original coupon of 13.40 percent.
Proceeds to Cover Redemptions and New Borrowing
CBK Director of Financial Markets David Luusa confirmed the auction results and said the proceeds would serve dual purposes. Funds raised through the shorter bond would cover upcoming redemptions, while receipts from the longer bond would support fresh government borrowing or contribute to net repayment obligations, in line with the government’s debt-management strategy.
The combined bid-to-cover ratio across both instruments reached 2.13, a figure analysts say reflects continued confidence in Kenya’s sovereign credit among both domestic and institutional investors. The auction’s outcome exceeding its target by more than double suggests that liquidity in the market remains elevated, even as the government manages a sizable fiscal deficit heading into the second half of the fiscal year.
Kenya has been one of East Africa’s most active issuers of domestic debt, relying heavily on treasury bond auctions to finance its budget. The February auction’s strong performance is the latest indicator that demand for longer-duration government paper continues to hold firm, providing CBK with room to manoeuvre on future issuances.
