During the first quarter of 2022, T-bills were slightly oversubscribed, with the overall subscription rate coming in at 101.5 percent, up from 69.1 percent in Q4’2021.
The oversubscription was partly attributable to the eased liquidity in the money market during the quarter, which saw the average interbank rate decline to 4.7 percent, from 5.1 percent in Q4’2021.
Overall subscriptions for the 91-day paper declined to 89.0 percent from 103.9 percent in Q4’2021 while that of the 182-day and 364-day papers increased to 80.9 and 127.1 percent in Q1’2022, from 59.0 and 65.3 percent in Q4’2021, respectively.
The yields on government securities in the secondary market were on an upward trajectory during the quarter, which saw the FTSE bond index decline by 1.1 percent to close at 95.0 shillings, from 96.1 shillings recorded in Q4’2021.
Read More: T-Bills Drop Further To 55.8% Due To Investors’ Preference Of Longer-Dated Papers
During the week, T-bills remained undersubscribed, with the overall subscription rate coming in at 29.7 percent, down from the 55.8 percent recorded last week.
This was partly attributable to the tightened liquidity in the market, with the average interbank rate coming in at 4.6, from 4.3 percent recorded the previous week.
The 91-day paper recorded the highest subscription rate, receiving bids worth Kshs 1.5 bn against the offered Kshs 4.0 bn, translating to a subscription rate of 38.1 percent, a decline from the 58.0 percent recorded the previous week.
The subscription rate for the 182-day and 364-day papers declined to 31.3 and 24.7 percent, respectively, from 38.4 percent and 72.2 percent, recorded the previous week.
The government accepted bids worth 7.10 billion shillings, out of the 7.13 billion shillings worth of bids received, translating to an acceptance rate of 99.7 percent, reflecting the government’s debt appetite.
Read More: T-Bills Strike Back With A Oversubscription After Days In The Red
At the same time, during Q1’2022, the equities market was on a downward trajectory, with NASI, NSE 20, and NSE 25 declining by 6.4, 2.9, and 4.8 percent, respectively.
The equities market performance during the quarter was driven by losses recorded by large caps such as Safaricom, EABL, Bamburi, and Equity Group of 10.0, 9.1, 5.9, and 4.3 percent, respectively.