Finance secretary Henry Rotich and Controller of Budget Agnes Odhiambo brief the media on queries raised over Eurobond expenditure at the National Treasury Building in Nairobi on December 4, 2015. PHOTO | DIANA NGILA
What you need to know:
Treasury cabinet secretary Henry Rotich says cash from issue was used to settle a loan and disbursed to ministries.
There has also been pressure on the Treasury to show which projects were actually funded by the proceeds from the Eurobond.
Mr Rotich on Friday said he had asked various ministries to send a list to the Treasury on the projects and their stages of implementation in the next three weeks.
National Treasury received a Sh6.5 billion bonus from the reopening of the sovereign bond that raised Sh75 billion ($750 million) last December bringing the total proceeds to about Sh281 billion.
The initial tranche of the bond had in June realised Sh200 billion ($2 billion) but this was reopened owing to the good reception at the Irish Stock Exchange where it was listed, Treasury cabinet secretary Henry Rotich revealed last Friday.
Addressing the press, Mr Rotich said the money raised was first used to settle the syndicated loan that had been secured from commercial banks the previous year.
“Because of the success we had with the initial bond issue at the Irish Stock Exchange, we decided to go for the tap sale and we were able to get a bonus of over Sh6 billion,” said Mr Rotich.
That means the net proceeds from the tap sale was not the planned Sh75 billion, but Sh81.5 billion.
“Net proceeds from the tap sale were $815,684,271 [Sh81.5 billion) and therefore tap sales were sold at a premium of $65,684,271 [Sh6.5 billion].
“The proceeds from the tap sales were credited into Central Bank of Kenya account held with Citibank New York,” said Mr Rotich.
The minister had called the press conference in the wake of claims that there was no information as to what happened to the money raised through sovereign bond.
There has also been pressure on the Treasury to show which projects were actually funded by the proceeds from the Eurobond.
Last Friday, Mr Rotich said he had asked various ministries to send a list to the Treasury on the projects and their stages of implementation in the next three weeks. He said cash had already been disbursed to the spending units for the development projects.
During the same press conference, the Controller of Budget Agnes Odhiambo said the net proceeds from the bond issue had been received and properly deposited in the Consolidated Fund as required.
Initially the cash was deposited at a CBK account in New York, but it was finally moved to Kenya.
“I can confirm that all the net proceeds from the bond issue was received in the Consolidated Fund,” said Ms Odhiambo.
She said that her office decided to countercheck all the claims and facts about the Eurobond so as to satisfy itself about the whereabouts of the money, tracking it from New York to the Consolidated Fund.
Stressing that most of the projects were funded using the sovereign bond cash, Treasury PS Kamau Thugge said that Sh270 billion had been disbursed to the ministries, departments and agencies of the government as their development budget.
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