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Investors pay premium in reopened bonds sale
Previously, long term securities such as the reopened 25-year papers were the preserve of institutional investors such as pension funds, while banks and retail investors preferred shorter dated papers including Treasury bills.
Investors are now paying a premium for reopened bonds carrying higher returns, as they race to secure the much sought-after securities in a market where interest rates are falling.
The latest bond sale which closed last week, comprising two re-opened 20 and 25-year papers, saw investors pay Sh106.46 and Sh111.97 respectively per bond unit of Sh100—effectively absorbing an upfront loss by paying above the face value of the securities.
