All Eyes Set on T-Bill Auctioning: Will it a Blood bath for CBK?

All eyes are set on the T-bill auction this week which most economic analysts believe that it will be a bloodbath after CBK’s announcement of the 25-year bond auction for this month.

The prime rates are expected to come off significantly as short-term investors looking for a home for KES liquidity.

The shilling continued to come under pressure closing at 101.04 shillings to the dollar as the dollar continued to rally globally. This creates slight unease heading into the close of the financial year.

Kenya is about to enter into the budget cycle where rates come under pressure as government spending halts pending the new budget. In such an environment a shilling under pressure only exacerbates the situation.

The KES overnight rate closed at 3.3 percent on volumes of 14 billion shillings as analysts at Genghis Capital expect to mop up actions from the regulator in Wednesday’s session

In Other Corporate News

Centum Investments announced a disappointing set of financials for FY18. EPS dropped 63.8 percent on a year-on-year basis to 3.96 shillings.

Profitability was dragged by 31.8 percent drop in investment income, 80.9 percent growth in operating and administrative costs and 48.4 percent drop in earnings from associates.

Revenue from the trading business recorded 8.2 percent growth while operating costs rose faster, 10.9 percent.

Operating loss from financial services (mainly Sidian Bank) widened by 3031.9 percent to 504 million shillings.

Despite the poor numbers, a dividend per share of KES 1.20 (similar to last year’s) has been recommended and will be payable to shareholders on the register as at 2 October 2018.