Withdrawal of Kenya's six-month T-bill lifts sale of other papers

Central Bank of Kenya (CBK)'s move to withdraw the sale of 182-day Treasury bill in the last three auctions has paid off, with 91-day and 364-day bills currently registering oversubscription.

The six-month paper before its withdrawal had been investors' favourite because of the high returns it offered, clouding the other two securities.

Its subscription had for weeks peaked at 400 percent as the other two recorded up to 20 percent uptake.

The move to withdraw the 182-day bill, according to analysts, was aimed at helping in management of maturities, by spreading their concentration risk evenly across the three papers.

With the 182-day Treasury bill out of auction, the 91-day and 364-day papers have been performing well, with the former registering oversubscription this week for the first time in months.

The Central Bank as in the past week offered 91 and 364 days Treasury bills for a total of 194 million U.S. dollars, 97 million dollars each.

"The total number of bids received amounted to 104 million dollars representing 112 percent subscription and 124 million dollars representing 133 percent subscription for 91 and 364 days, respectively," said the bank in auction results Friday.

Bids accepted amounted to 69 million dollars for 91 days and 90 million dollars for 364 days Treasury bills.

The weighted average rate of accepted bids, which will be applied for non-competitive bids, was 8.76 percent for the 91-day and 10.92 percent for 364-day Treasury bills.

Last week, subscription rates for the 91 and 364 days papers came in at 97 percent and 166 percent respectively. Endit