(Xinhua) -- Kenya raised 318 million U.S. dollars
from two 10-year bonds worth 291 million dollars it floated this
month to cover end of fiscal year deficit.
The bonds were massively
oversubscribed, with data from the Central Bank of Kenya (CBK)
Thursday indicating a high appetite from investors.
Both bonds, FXD 3/2008/10 and FXD
1/2009/10, performed exceptionally well but it is the latter
that attracted most bids, raising 268 million dollars while the
former 211 million dollars.
In total, the bonds raised 479 million
dollars with the CBK, however, rejecting 161 million of
“The weighted average rate for
successful bids was 11.3 percent for the FXD3/2008/10 bond
and 11.9 percent for the FXD1/2009/10 bond,” said the CBK.
In the last three auctions, the
government has rejected expensive bids from investors, given
that the domestic borrowing program is ahead of target.
Therefore, it is under no pressure to borrow at yields above
Analysts, however, noted that the
government would extensively borrow from the domestic market
towards end of the fiscal year to avoid the lengthy process in
Kenya has in this fiscal year,
2016/2017 borrowed heavily from internal than external sources
despite plan to borrow more from the latter to ease pressure on
domestic interest rates.
According to the Central Bank, Kenya
has so far borrowed 2.3 billion dollars locally this financial
year against a target of 1.7 billion dollars.
On the other hand, the government has
borrowed some 2 billion dollars of the budgeted foreign
borrowing, which was 4.6 billion dollars representing 45 percent
of the targeted amount.