Central Bank of Kenya Launches KSh 20 Billion Bond Auction With Retail Entry Points at KSh 50,000

The Central Bank of Kenya is offering 12.5% interest on new 30-year bonds. Learn how retail investors can participate with KSh 50,000 before the April 15 deadline.

By: AXL Media

Published: Apr 8, 2026, 10:38 AM EDT

Source: Information for this report was sourced from TUKO.co.ke

Government Targets Multi Billion Shilling Budgetary Support

The Central Bank of Kenya, acting as the fiscal agent for the Republic, has initiated a new domestic borrowing drive by offering two long-dated treasury bonds totaling KSh 20 billion. This auction includes the reopening of a 30-year bond originally issued in 2011 and the introduction of a brand-new 30-year security maturing in 2056. The move is designed to provide critical funding for the national budget during a period of expanding public expenditure. Both instruments carry fixed coupons, providing a predictable income stream for investors over a duration that reflects the government’s long-term fiscal planning.

Preferential Tax Terms and Market Yields

To incentivize participation, the state has attached a reduced withholding tax of 10% to both bonds, a significant drop from the standard 15% rate usually applied to shorter-term government securities. The reopened bond (SDB1/2011/030) carries a 12.0% coupon with roughly 14.9 years of its tenor remaining, while the new issue (FXD1/2026/030) offers a higher 12.5% rate. By lowering the tax burden, the Central Bank is effectively increasing the net take-home returns for bondholders, making these long-term assets more competitive against other high-yield investment options in the regional market.

Expanding Retail Access Through Digital Integration

In a deliberate effort to democratize the government securities market, the Central Bank has maintained a low entry threshold of KSh 50,000 for retail participants. Individual investors can utilize non-competitive bidding, which allows them to purchase bonds at the average market rate without needing to forecast specific yields. This process has been further streamlined through the DhowCSD Investor Portal and mobile app, where successful bidders can manage their transactions and obtain payment keys digitally. The government’s strategy aims to shift the investor base from being purely institutional to including more ordinary Kenyan citizens.