High returns from Kenya’s 182-day Treasury bill have lured investors to the paper, with subscriptions more than doubling at this week’s auction.

The paper for several weeks has been investors’ favorite, attracting higher bids as compared to the 91-day and 364-day bills.

In this week’s auction, the Central Bank of Kenya (CBK) offered 182-day Treasury bills worth 98 million U.S. dollars.

The paper attracted bids worth 220 million dollars, which was a subscription of 227 percent from the previous week’s 144 million dollars, a performance of 145 percent. Yields on the paper stood at 10.3 percent.

On the other hand, the apex bank put up for sale 91-day bills worth 38 million dollars, with the security attracting bids worth 39 million dollars at 8.13 percent, which was a subscription of 101 percent.

The 364-day bill, similarly, attracted bids worth 99 million dollars from the 98 million dollars sought by the Central Bank.

Bids accepted from the three papers by the Central Bank totalled 340 million dollars out of the 360 million dollars received from investors, with the regulator picking 200 million dollars from the 182-day paper.

Analysts noted that the 182-day paper is over-performing because it is offering higher returns to investors on a risk-adjusted basis compared to the 364-day.

The 91-day T-bill remains unattractive as it is currently trading below its five-year average of 9.3 percent.

“The lower yield on the 91-day paper is mainly attributed to the low interest rates environment we have been experiencing, and we expect this to continue in the short-term,” said Cytonn, a Nairobi-based investment firm. Enditem

Source: Xinhua/


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