Kenya completes 25-year bond sale
Kenya has completed the issue of a 25-year bond raising 7.5 billion Kenyan shillings (€74 million), making it the first country in Sub-Saharan Africa to do so.The Daily Nation reported yesterday (June 24th) that the country's government will be able to gain access to cheaper debt as a result of the successful move, which was more than three times oversold, with the government receiving bids totalling 27.1 billion Kenyan shillings. According to the news source, "cut-throat competition among investors" helped complete the bond sale.
"The return is very low for a bond with such a tenor, which explains the excess liquidity in the market looking for investment opportunities, but with not many options," Head of Fixed Income for Bank of Africa Duncan Kinuthia was quoted by the newspaper as saying. It is due to be retired in 2035 and joined the 20, 15, 12 and ten-year bonds that the country has issued over the past three years.
Business Daily Africa claimed earlier in the year that a new automated trading system for bonds means transactions are likely to be higher in 2010 than in 2009.