A wealthy group of private investors helped the national government to raise Ksh81 billion after it put up the country's infrastructural bonds for sale.
According to the Central Bank of Kenya (CBK), the government was initially targeting Ksh50 billion.
However, once the bonds were made available, there was an overwhelming number of bids totalling Ksh125 billion, of which Ksh81 billion was accepted.
This is in line with the recent trend in which the country has witnessed a high investor appetite for government securities.
The minimum amount to invest was tagged at Ksh 100,000 with interest payable every six months.
Infrastructural bonds have proven to be very attractive for investors given they are tax-free as provided for under the Income Tax Act.
President Uhuru Kenyatta’s Jubilee administration has a long list of infrastructure projects that it had planned to execute during the 2019/2020 financial year.
This is the second infrastructure paper being sold in the current fiscal year, following the Ksh70 billion, 11-year bond that was floated in August. It attracted bids worth Kshh102 billion, with the government taking up Ksh78.56 billion.
They included the Ksh55.8 Billion Naivasha – Nairobi Standard Gauge Railway, the affordable housing plan, and the Ksh55.8 billion Lamu Port, South Sudan, Ethiopia (LAPSSET) transport corridor, considered Eastern Africa’s largest and most ambitious infrastructure project, among others.
Kenya has successfully issued Infrastructure Bonds since 2009 when the first Bond was issued to Ksh18.5bn to fund specific projects in Transport, Energy, Water, and Irrigation Sectors.
