CBK to Sell 18-year Bond Worth Ksh 60bn, Strong Demand Projected

The fast-paced development of major industrial corridors (see map below) in recent years has played a significant role in transforming the warehousing and logistics sector which has long been held back by poor infrastructure. 

Ongoing construction of The Nairobi Expressway under construction.

The Central Bank of Kenya announced it will sell a new 18-year Infrastructure Bond  (IFB1/2021/18)  worth Ksh 60 billion in April.

The bond is currently on offer until  06/04/2021.  Its coupon is market-determined.

What Analysts Say

“Given the tax-free nature of the bond coupled with the government’s increased appetite for domestic borrowing to bridge the budget deficit, we anticipate an oversubscription and a high acceptance rate,” Cytonn Investments.

“While this is an off the curve paper, it should give a fair indication of both the government demand and potential appetite from the market, given the recent developments,” NCBA Market Research.

“The on-the-run infrastructure bond (IFB1/2021/16 issued in January) has surged meaningfully from the auction prices (current yields of 11.76% -vs- average auction yield of 12.257%). Thus, we see an attractive exit level in IFB1/2021/16 for investors eyeing IFB1/2021/18,” Genghis Capital.