Long-Dated Appetite: CBK Accepts KSh 57.51B in Reopened 15-Year and 20-Year BondsLong-Dated Appetite: CBK Accepts KSh 57.51B in Reopened 15-Year and 20-Year Bonds
Key Highlights
- Investors bid KSh 80.56B ($620.00M) for two reopened long-dated bonds, and the Treasury accepted KSh 57.51B ($442.55M) of it.
- The 20-year bond cleared at a weighted average yield of 13.60%, nearly one percentage point above the 15-year bond.
- Most of the money accepted came from non-competitive bids, which leave the yield to be set by the auction.
Kenya's Treasury has raised KSh 57.51B ($442.55M) from reopened 15-year and 20-year bonds, with the longer bond drawing the stronger demand.
The Central Bank of Kenya said in its auction results that investors bid KSh 80.56B ($620.00M) across the two bonds. The results are dated 5 October 2026, and dollar values in this report are converted at KSh 129.94 to the dollar, the rate in the bank's latest weekly bulletin.
The 15-year bond, FXD3/2019/015, drew bids of KSh 34.56B ($265.96M). The bank accepted KSh 28.60B ($220.12M) at a weighted average yield of 12.73% on accepted bids. The bond has 7.8 years left to run and carries a coupon of 12.34%.
The 20-year bond drew the heavier bidding
The 20-year bond, FXD1/2019/020, attracted bids of KSh 46.00B ($354.03M) and the bank accepted KSh 28.90B ($222.43M) at 13.60%. It carries a coupon of 12.87% and has 12.5 years remaining.
The gap between the two bonds is wide. The 20-year paper recorded a performance rate of 92.01% and a bid-to-cover ratio of 1.59, against 69.12% and 1.21 for the 15-year bond. The performance rate compares bids received with the amount offered, so the 15-year bond attracted less than the full amount on offer while the 20-year bond came close to it.
The market weighted average rates, which reflect all bids and not only those accepted, were 12.87% for the 15-year bond and 13.80% for the 20-year bond. The bank therefore accepted bids at yields below the average of what the market asked.
Non-competitive bids made up most of the take
Most of the money accepted came through non-competitive bids, which do not name a yield and are filled at the rate the auction sets. On the 15-year bond they came to KSh 26.84B ($206.55M) of the KSh 28.60B accepted, and on the 20-year bond KSh 27.84B ($214.28M) of KSh 28.90B.
Competitive bids, which do state a yield, made up only KSh 1.76B on the 15-year bond and KSh 1.06B on the 20-year bond. That means the accepted yields were set by a small slice of the total, a point worth bearing in mind when reading the headline rates.
The auction follows a week of strong demand for short-term government paper. As Mwenendo earlier reported, investors bid heavily for Treasury bills while yields on those shorter instruments slipped.
For savers and institutions weighing where to place money, the results show that long-dated Kenyan government debt is still yielding above 12.70%, well above the rates on bills. They also add to a heavy borrowing programme. In an earlier report by Mwenendo, tax money will pay KSh 986.73 billion in local debt interest this financial year.
The bank's results do not say who bought the bonds, and trading in them continues in the secondary market, where bond turnover data shows heavy activity.
In Summary
- Who ran the auction?
- The Central Bank of Kenya, acting for the National Treasury.
- What did the Treasury raise?
- KSh 57.51B ($442.55M) from reopened 15-year and 20-year bonds, from bids of KSh 80.56B ($620.00M).
- When were the results dated?
- The results are dated 5 October 2026.
- Which bonds were reopened?
- The 15-year FXD3/2019/015 and the 20-year FXD1/2019/020, issued by the Government of Kenya.
- Why does the yield gap matter?
- The 20-year bond cleared at 13.60% against 12.73% for the 15-year bond, showing what investors demanded for longer exposure.
- How were the yields set?
- Non-competitive bids made up most of the amount accepted, so a small share of competitive bids set the rates.