The Kenyan Treasury has launched a Ksh30 billion bond buyback program aimed at easing its near-term debt burden ahead of the FXD1/2023/003 bond’s May 2026 maturity. The bond carries a hefty 14.228% coupon, making it one of the more expensive liabilities on the government’s books, with an outstanding stock of Ksh76.5 billion as of November 2025.
The Central Bank of Kenya (CBK) invited investors on Monday to submit offers to tender part or all of their holdings in this bond for early repurchase. The voluntary buyback seeks to retire a portion of the debt months before maturity, helping the government manage cash flow and avoid a concentration of redemptions in the next fiscal year.
“The Treasury bonds bids must be submitted to the Central Bank electronically via CBK DhowCSD by 10am on Monday, November 17, 2025,” the official notice read. Investors are required to release any pledged holdings at least five days before the auction to participate.
Analysts say the move is designed to flatten the short-term debt redemption curve. Projections show that total public debt servicing costs will surpass Ksh1 trillion in interest payments during the 2025/2026 fiscal year, highlighting the urgency of managing expensive debt.
Investors will submit competitive bids based on preferred yields, with CBK applying a multi-price auction model to allocate accepted offers. Indicative pricing ranges from clean prices of 100.5 at a 13% yield to 103.6 at a 6.25% yield, offering the potential to exit above par depending on market demand.
Successful bidders will obtain their auction results via the DhowCSD Investor Portal on Monday, November 17, and payments are scheduled for Wednesday, November 19, 2025. The Treasury’s initiative underscores its proactive approach to managing high-cost debt and smoothing the debt repayment calendar for the upcoming financial year.
