T-Bills Subscription Move Past 100% After Days In The Red

During the week, T-bills were oversubscribed, with the subscription rate coming in at 110.0 percent, up from 64.9 percent the previous week.

The oversubscription of the T-Bills during the week was partly attributable to the favorable liquidity in the money markets as evidenced by the decline in the average interbank rate to 2.1 percent from 3.3 percent, recorded the previous week.

The highest subscription rate was in the 91-day paper, which came in at 186.5 percent, up from 154.7 percent recorded the previous week.

The subscription for the 182-day paper fell to 39.3 percent from 40.6 percent in the previous week, while that of the 365-day paper rose to 150.1 percent from 53.3 percent recorded the previous week.

The yields on the 91-day, 182-day, and 364-day papers rose marginally by 0.1 percentage points, respectively, to 6.5, 6.9, and 7.8 percent, from 6.4, 6.8, and 7.7 percent recorded the previous week.

The acceptance rate increased to 93.9 percent, from 68.7 percent recorded the previous week, with the government accepting bids worth 24.8 billion shillings out of the 26.4 billion shillings worth of bids received.

In the money markets, 3-month bank placements ended the week at 7.2 percent (based on what we have been offered by various banks).

The 91-day T-bill increased marginally to 6.5 percent, from 6.4 percent recorded the previous week. The average yield of the Top 5 Money Market Funds remained unchanged at 10.1 percent.

The yield on the Cytonn Money Market increased by 0.3 percent points to close at 10.9 percent, from the 10.6 percent recorded the previous week.

Liquidity

The money market liquidity improved during the week, with the average interbank rate decreasing to 2.4 percent, from 3.5 percent recorded the previous week, mainly supported by government payments.

The average interbank volumes declined by 22.0 percent to 8.0 billion shillings, from 10.2 billion shillings recorded the previous week.

According to the Central Bank of Kenya, commercial banks’ excess reserves came in at 14.8 billion shillings in relation to the 4.25 percent Cash Reserve Ratio.

READ: T-Bills In The Red For Three Weeks Running: Any Hope?