T-Bills Remained Oversubscribed In May At 153%

During May 2024, T-bills were oversubscribed, with the overall average oversubscription rate coming in at 153.3%, higher than the oversubscription rate of 129.6% recorded in April 2024.

The overall average subscription rates for the 91-day and 182-day papers increased to 326.7% and 134.1%, from 231.9% and 78.0% respectively, while the overall average subscription rates for the 364-day paper decreased to 103.1% from 140.3%, which was recorded in April 2024.

The average yields on the government papers decreased during the month, with the 364-day, 182-day, and 91-day papers yields decreasing by 5.8 bps, 13.2 bps, and 10.0 bps to 16.6%, 16.5%, and 15.9% respectively from 16.6%, 16.7%, and 16.0% recorded the previous month.

For May, the government accepted a total of Kshs 178.0 bn of the Kshs 183.9 bn worth of bids received, translating to an acceptance rate of 96.8%.

Last week, T-bills were oversubscribed for the fifth consecutive week, with the overall oversubscription rate coming in at 139.6%, higher than the oversubscription rate of 100.1% recorded the previous week.

Investors’ preference for the shorter 91-day paper persisted, with the paper receiving bids worth Kshs 17.9 bn against the offered Kshs 4.0 bn, translating to an oversubscription rate of 446.6%, significantly higher than the oversubscription rate of 177.6% recorded the previous week.

The subscription rate for the 182-day paper decreased to 91.7% from 116.5% while the subscription rate for the 364-day paper increased to 64.7% from the 52.8% recorded the previous week.

The government accepted a total of Kshs 32.8 bn worth of bids out of Kshs 24.0 bn bids received, translating to an acceptance rate of 97.9%.

Read Also: Absa Bank Kenya PLC Reports A 34% Increase in Q1 Net Earnings

The yields on the government papers were on an upward trajectory, with the yields on the 91-day, 182-day, and 364-day papers increasing by 0.9 bps, 4.4 bps, and 8.3 bps to 15.95%, 16.61%, and 16.71% from 15.94%, 16.56% and 16.62% respectively recorded the previous week.

So far in the current FY’2023/24, government securities totalling Kshs 1,762.0 bn have been advertised. The government has accepted bids worth Kshs 2,107.5 bn, of which Kshs 1,403.3bn and Kshs 704.1 bn were treasury bills and bonds, respectively.

Total redemptions so far in FY’2023/24 equal to Kshs 1,642.5 bn, with treasury bills accounting for Kshs 1,485.3 bn and bonds accounting for Kshs 39.2 bn. As a result, the government has a domestic borrowing surplus of Kshs 464.9 bn in FY’2023/24.

Read Also: NCBA Embarks On A Diaspora Banking Market Activation Across The United States