CBK raises Sh70.8 billion as Treasury bond demand surges

The Central Bank of Kenya (CBK) has raised Sh70.86 billion from investors through the reopening of two Treasury bonds, surpassing the government's initial target of Sh50 billion after receiving bids worth nearly Sh100 billion.

The strong demand saw investors submit applications totalling Sh99.47 billion, representing a bid-to-cover ratio of 1.40, meaning the amount offered by investors was 40 per cent higher than the government's borrowing target.

The auction results, released on Wednesday, November 4, 2026, involved the reopening of a 15-year Treasury bond, FXD3/2019/015, and a 30-year security, FXD1/2026/030, as the government continued to raise money through the domestic debt market.

The two bonds attracted different levels of investor interest, with the longer-term security accounting for the larger share of the bids received and the amount accepted by the CBK.

According to the auction results, the reopened 15-year Treasury bond received applications worth Sh37.07 billion, out of which the Central Bank accepted Sh29.90 billion.

The bond, which has approximately 7.8 years left before maturity, offers an annual coupon rate of 12.34 per cent and is scheduled to mature on July 10, 2034.

Its market-weighted average rate stood at 12.8717 per cent, while the weighted average rate for successful bids was recorded at 12.7404 per cent.

Investors buying the security at the average yield were offered Sh101.8243 for every Sh100 invested in the bond.

The 30-year Treasury bond attracted even greater interest, receiving bids amounting to Sh62.40 billion. The CBK accepted Sh40.95 billion from the applications submitted for the security.

Identified as FXD1/2026/030, the bond has approximately 29.5 years remaining before maturity and is due on March 13, 2056.

It carries an annual coupon rate of 12.5 per cent, while its market-weighted average rate reached 14.1711 per cent.

The weighted average rate for successful bids was slightly lower at 14.1266 per cent, with investors offered Sh89.3921 for every Sh100 of the bond at the average yield.

The figures show that investors demanded higher returns from the 30-year security compared to the 15-year bond, reflecting the different rates attached to the two investment periods.

A breakdown of the accepted bids showed that Sh32.18 billion came from competitive applications, while non-competitive bids accounted for the remaining Sh38.68 billion.

The funds raised will support the government's financing requirements, including the repayment of maturing debt obligations and other borrowing needs.

The CBK's application of funds indicated that Sh40.46 billion would be allocated towards redemptions, while Sh30.40 billion was reflected under new borrowing and net repayment.

Through reopening existing Treasury bonds, the government can raise additional money using securities that are already available in the market instead of introducing entirely new debt instruments.

Treasury bonds remain one of the government's main avenues for raising money locally, while providing investors with an opportunity to earn returns through regular interest payments.

Investors receive coupon payments at the agreed rates during the investment period, with the principal amount payable when the bond reaches maturity, in line with its terms.

The CBK also announced plans to issue additional Treasury bonds during November 2026, signalling further borrowing activity in the domestic debt market.

Details of the upcoming issues, including the amounts to be offered, maturity periods, coupon rates and other conditions, will be provided in separate prospectuses before the respective auction dates.