T-Bills Bounce Back After Weeks In The Red

By Soko Directory Team / Published February 22, 2021 | 8:05 am




KEY POINTS

Investors continued their preference on the 364-day paper which had the highest subscription rate of 139.05, down from 160.8%.


market Selling markets

T-bills were oversubscribed last week with the overall subscription rate increasing to 124.9 percent, from 90.6 percent recorded the previous week.

The oversubscription was attributable to improved liquidity in the market as evidenced by interbank rates declining to 3.9 percent, from 4.9 percent recorded the previous week.

Investors continued their preference on the 364-day paper which had the highest subscription rate of 139.0 percent, down from 160.8 percent recorded the previous week.

This is mainly attributable to investor preference for medium-term papers as they now believe that the pandemic has been contained but are still worried about the possible effects of the current rising political temperatures preceding the elections in August 2022.

The subscription rate for the 182-day and 91-day papers increased to 114.0 and 116.9 percent, from 47.0 and 23.9 percent recorded the previous week, respectively.

The yields on 364-day, 182-day, and 91-day papers rose by 10.7 bps, 4.0 bps, and 0.6 bps to 8.9, 7.7, and 6.9 percent, respectively.

The government received bids worth 30.0 billion shillings, accepting only 28.8 billion shillings, translating to an acceptance rate of 96.1 percent.

The Central Bank of Kenya opened two bonds on tap sale, FXD1/2013/15 and FXD1/2012/20, with effective tenors of 7.1 years and 11.8 years, and coupons of 11.3 and 12.0 percent, respectively.

The bonds had an average rate of 11.8 percent for FXD1/2013/15 and 12.6 percent for FXD1/2012/20. The issues recorded low demand, with the overall subscription rate coming in at 62.4 percent, mainly attributable to the short bidding period.

The government received bids worth 11.2 billion shillings, lower than the 18.0 billion shillings offered, and accepted only 10.9 billion shillings. The acceptance rate came in at 97.1 percent, with the weighted average rate of accepted bids being 11.8 and 12.6 percent.

In the money markets, 3-month bank placements ended the week at 7.9 percent while the yield on the 91-day T-bill rose by 0.6 bps to 6.9 percent.

The average yield of the Top 5 Money Market Funds rose by 0.1 percentage points to 10.0 percent from the 9.9 percent recorded last week. The yield on the Cytonn Money Market increased by 21.0 bps to 10.8 percent, from 10.6 percent recorded the previous week.

READ: T-Bill Subscription Still Below 100% As GoK Receives Ksh 21.7 Bn In Bids





About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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