The government through the Central Bank of Kenya (CBK) has announced a tap sale of Treasury bonds worth Ksh15 billion, inviting interested investors to participate.
According to a circular dated August 20, the sale of the bonds will operate on a first come, first served basis.
CBK explained that the tap sale is for Treasury Bond issue no. IFB1/2023/017, dated September 2, 2024, with the sale period running from August 20 to August 29, or until the target amount is reached.
“Central Bank of Kenya is pleased to offer eligible investors an opportunity to participate in a Tap Sale of the above Treasury Bonds whose details are as in the prospectus issued value date 19/08/2024,” said the CBK.
“Period of Sale: Tuesday, 20th August 2024 to Thursday, 29th August 2024 or upon attainment of quantum, whichever comes first,” added CBK.
Details of the Treasury Bonds Tap Sale
Furthermore, CBK announced that bids will be priced based on the average rate of accepted bids from the auction held on August 19, adjusted for accrued interest.
The average yield for this bond is 17.7279%, with a coupon rate of 14.3990% and an adjusted average price of 91.0149 per Ksh100.
Also Read: CBK Announces Tax Free Ksh50 Billion Infrastructure Bonds
Investors have been urged to submit their bids by 2p.m. Thursday, August 29, with the settlement date being set on September 2 and payment due by 2 p.m. on the same day.
Also, CBK in their circular noted that from September 2, 2024, onwards, licensed placing agents will not be paid commission.
Regarding the bid allotment, CBK said that this would also be on a first-come, first-served basis.
CBK advised investors to obtain details of successful bid amounts from the DhowCSD Investor Portal/App under the transactions tab on August 30.
“Auction Results: Investors should obtain details of amounts payable for successful bids from DhowCSD Investor Portal/App under the transactions tab on Friday, 30th August 2024.”
CBK Announces Tax Free Ksh50 Billion Treasury Bonds
This announcement follows another made by the Central Bank of Kenya on August 12, announcing the sale of bonds valued at Ksh50 billion.
In their notice, CBK said that the bonds, meant for infrastructure development for the fiscal year 2024/2025 are tax-free and invited bids from interested investors, located both locally and abroad.
Also Read: Investors Snubbing Treasury Bonds Over Interest Rate Risks
They also announced that the bond issuance comes with a minimum investment of Ksh50,000 in a bid to make it accessible to a wide range of investors ranging from individuals to large institutions.
“Central Bank of Kenya, acting in its capacity as fiscal agent for the Republic of Kenya, invites bids for the above bonds whose terms and conditions are as follows,
“The bonds will be tax free as is the case for Infrastructure Bonds as provided for under the income tax act” the statement read in part.
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