Investors Get New Entry Point as CBK Relaunches Ksh 60B Fixed Coupon Bonds

The Central Bank of Kenya (CBK), acting for the government, has announced the reopening of two long-term fixed-coupon Treasury bonds.

The offer gives investors another chance to invest in government securities used to support the national budget.

The bonds on offer are FXD1/2018/020 and FXD1/2021/025, with a combined target of Ksh 60 billion.

CBK opened the sale period from June 9, 2026, to June 17, 2026, with bids closing on June 17, 2026, at 10:00 am. The auction will also be held on the same day, while settlement is set for June 22, 2026.

The bonds include:

FXD1/2018/020

• Tenor: 20-year bond (about 11.8 years remaining)
• Coupon rate: 13.200%
• Maturity date: March 1, 2038

FXD1/2021/025

• Tenor: 25-year bond (about 20 years remaining)
• Coupon rate: 13.924%
• Maturity date: April 9, 2046

Both bonds attract a 10% withholding tax on interest earned.

How Investors Can Participate in CBK Treasury Bonds

CBK has set different bidding options:

• Non-competitive bids: Minimum Ksh 50,000 and maximum Ksh 50 million
• Competitive bids: Minimum Ksh 2 million per CSD account per tenor

Investors can submit bids through the DhowCSD Investor Portal/App or through commercial and investment

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Pricing and Yield Information

CBK provided indicative pricing tables showing how bond prices change with different yields.

For FXD1/2018/020:

At lower yields (around 11%), prices are above 110

At higher yields (around 15%), prices fall to around 90

For FXD1/2021/025:

At lower yields (around 11%), prices are above 120

At higher yields (around 15%), prices drop to around 93

The bonds are priced on a clean price basis, with accrued interest added to get the final purchase (dirty price).

For example:

FXD1/2018/020 includes accrued interest of Ksh 3.5538 per Ksh 100

FXD1/2021/025 includes accrued interest of Ksh 1.8744 per Ksh 100

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Coupon Payment Schedule

Both bonds pay interest semi-annually throughout their remaining life, with multiple coupon payment dates extending to maturity.

The payments are structured to give investors regular income every six months until 2038 and 2046, respectively.

Once issued, the bonds will begin secondary trading on June 22, 2026, in multiples of Ksh 50,000.

They will also be listed on the Nairobi Securities Exchange (NSE), allowing investors to buy or sell before maturity.

Liquidity and Investor Benefits

CBK highlighted several advantages of the bonds:

• They qualify for the statutory liquidity ratio requirements for banks
• Investors can use them as collateral for loans
• They can be pledged to financial institutions
• They can be rediscounted by CBK as a last resort (at a premium above market rates)

Important Notes to Investors

• CBK may accept or reject bids fully or partially without explanation
• Defaulters risk suspension from future government securities
• Investors must collect payment details via the DhowCSD platform
• Bonds may be reopened in the future, depending on market conditions

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CBK Governor Kamau Thugge during a press briefing at KICC
PHOTO/CBK