T-Bill Subscription Hits 200 Percent For The First Time In Days

For months, since the confirmation of the first Covid-19 case in Kenya, the subscription of T-Bills has been oscillating bellow 100 percent with above 100 on a few occasions.

Last week, however, the subscription of T-Bills was above 200 percent according to stats compiled by Cytonn Investments Limited in their latest report for the week.

The subscription rate for the week came in at 209.1 percent from 102.9 percent witnessed the previous week.

According to Cytonn, the oversubscription was a result of favorable liquidity in the money markets during the week under review.

The interbank rate for the week came in at 3.2 percent, a drop from 3.5 the previous week, supporting the subscription of the T-Bills.

The subscription rate for 91, 182, and 364-day papers increased to 255.6, 213.0, and 186.5 percent respectively from 81.3, 51.4, and 155.0 percent recorded the previous week.

Yields on all the papers remained unchanged during the week. The weighted average interest rates for accepted bids for 91, 182, and 364-day papers came in at 7.3, 8.2, and 9.2 percent respectively.

The Central Bank of Kenya is keen on maintaining interest rates low and as a result, the acceptance rate declined to 35.4 percent from 58.5 percent previously.

In the money markets, the 3-month bank placements ended the week at 7.5 percent according to data collection and compiled by Cytonn Investments.

The 91-day T-Bill remained unchanged at 7.3 percent, similar to what was recorded the previous week.

The average yield on the top 5 money markets across the country remained unchanged at 10 percent, similar to what was recorded the previous week.

The yield on Cytonn Money Market Fund declined by 0.1 percent to 10.7 percent from 10.8 percent.

According to Cytonn Investments, the only assured vehicle of investment for the majority of Kenyans is Money Market Funds which the company says has more assured returns as compared to other investment avenues.

Cytonn Money Market has remained among the top-performing in the country with a high-interest rate, hitting 11 percent annually. Kenyans are, however, still not aware of how money markets work.

READ: T-Bills Still Wounded By Covid-19; Any Hope Of The Wound Drying Up?