T-Bills Jump From 37% To 102.5% During The Week

By Soko Directory Team / Published July 12, 2022 | 8:59 am

KEY POINTS

The government continued to reject expensive bids, accepting a total of 24.2 billion shillings worth of bids out of the 24.6 billion shillings received, translating to an acceptance rate of 98.4 percent.

KEY TAKEAWAYS

The subscription rate for the 364-day and 182- day papers also increased to 51.2 and 84.3 percent, from 24.4 and 17.5 percent, respectively, recorded the previous week.

During the week, T-bills were oversubscribed, with the overall subscription rate coming in at 102.5 percent, up from 37.1 percent recorded the previous week, partly attributable to investors’ preference for the shorter-dated papers as they avoid duration risk.

The 91-day paper recorded the highest subscription rate, receiving bids worth 11.0 billion shillings against the offered 4.0 billion shillings, translating to a subscription rate of 276.0 percent, an increase from the 118.2 percent recorded the previous week.

The subscription rate for the 364-day and 182- day papers also increased to 51.2 and 84.3 percent, from 24.4 and 17.5 percent, respectively, recorded the previous week.

The yields on the government papers recorded mixed performance, with the yields on the 182-day and the 91-day papers increasing by 5.7 bps and 7.0 bps to 9.3 and 8.2 percent, respectively while the yield on the 364-day paper declined by 0.5 bps to 10.0 percent.

Related Content: T-Bills Still In The Red, Elections To Blame?

In the primary bond market, the government released the auction results for the tap sale of the infrastructure bond, IFB1/2022/18, for the month of July highlighting that the bond recorded an undersubscription of 32.1 percent, partly attributable to the relatively tight liquidity in the money market during the period of issue.

The government sought to raise 20.0 billion shillings for funding infrastructural projects and received all the bids worth 6.4 billion shillings, translating to a 100.0 percent acceptance rate. The bond had a coupon rate and a market-weighted average rate of 13.7 percent.

About Soko Directory Team

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