The Central Bank of Kenya (CBK) has accepted only KSh 2.40 billion from the reopening of the 30-year Savings Development Bond (SDB), SDB1/2011/030.
Investors were also uninterested, submitting just KSh 8.07 billion in bids against a KSh 20 billion offer, giving a performance rate of 40.35%.The average accepted yield was 13.96% compared to a market-weighted 14.37%, with CBK rejecting most of the bids as investors sought higher rates.Kenya’s FY 2025/26 budget deficit is projected at 3.9% of GDP, requiring KSh 635.5 billion in net domestic borrowing.
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| Bond | SDB1/2011/030 (30-Year) |
|---|---|
The weak subscription underscores a sharp contrast with August’s record uptake, when CBK raised nearly KSh 270 billion through infrastructure bond reopenings and a tap sale.
That issuance absorbed much of the liquidity chasing tax-free securities and already covered over 40 percent of the KSh 635.5 billion domestic borrowing target for FY 2025/26. The September SDB auction shows investors pulling back, while CBK held firm on borrowing costs.
This month’s program seeks KSh 60 billion from reopenings of the 20-year FXD1/2018/020, the 25-year FXD1/2022/025, and the 30-year SDB1/2011/030.
With the first auction underperforming, focus now shifts to the two remaining sales scheduled for September 17 and settlement on September 22. The two carry a combined KSh 40 billion offer, with coupons of 13.20 percent and 14.19 percent.
With nearly KSh 270 billion already raised, the performance of the September reopenings will be critical in managing refinancing risks and keeping borrowing costs in check.