FTSE launches Kenya bond index

Global index provider FTSE Group on Wednesday launched the first bond index at the Nairobi Securities Exchange (NSE), giving investors a metric to measure returns on fixed income securities.

The index, which is the third to be launched by the global index provider in Kenya, gives investors a measure that can be compared with returns on various types of government bonds in other countries.

In November last year, FTSE Group launched the FTSE 15 and FTSE 25 indices putting the Kenyan equity market on the radar of a wider pool of foreign investors.

(Read: FTSE indices put Nairobi bourse on international radar)
The FTSE NSE Kenyan Shilling Government Bond Index will track the returns of Kenyan government securities.

Bob Karina, vice chairman NSE, said that the index was prepared in consultation with local fund managers and will be available worldwide.

“The purpose of the FTSE NSE Kenyan Shilling Government Bond Index is to measure the average performance that holders of the relevant types of bonds experience over time,” said Mr Karina, adding that it will be reviewed every month.

The FTSE NSE Kenya 15 Index, which tracks the performance of the largest fifteen stocks ranked by market capitalisation, and the FTSE 25 Kenya Index, which tracks the performance of the twenty five most liquid stocks at the NSE, have since November exposed stocks included in those induces to foreign investors.

Imogen Dillon Hatcher, executive director, global sales at FTSE Group said that the new index will make the Kenyan fixed income market more visible to investors in international markets.

“The index offers innovative investment opportunities in the local fixed income market and provides the Kenyan debt market with increased international visibility,” said Ms Hatcher.