Treasury urged to go for a Eurobond
The Treasury should go for a new Eurobond to take advantage of the declining interest rates in the international market, Dyer and Blair Investment Bank has advised.
Central Bank of Kenya (CBK) data shows the yields for the four outstanding Kenyan Eurobonds on sale in global markets have declined. Even relative to start of this year, all the Eurobond issues have seen their yields fall.
The yield on the 10-year issue of 2014 that is due to mature in 2024 has declined by a much bigger margin of 3.87 percentage points when taking account of its yield at the beginning of last year when it stood at 8.39 per cent.
“In the international market, yields on Kenya’s 7-year (2027), 10-year (2024), 10-year (2028), 12- year (2032) and 30-year (2048) Eurobonds decreased by 55.3, 23.2, 38.1, 45.0 and 37.2 basis points, respectively. The yields on the 10-year Eurobonds for Angola and Ghana also declined,” said the CBK.
Raiding the international market is therefore seen as a viable option, also from a demand point, with investors still keen on African debt issues.
