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Treasury Bills and Bonds
MatataMingi
#1641 Posted : Wednesday, May 10, 2023 11:32:02 AM
Rank: Member


Joined: 11/17/2009
Posts: 397
Location: Where everyone knows you
I received my coupon payment on Monday.
Waiting for more next week.
Queen
#1642 Posted : Friday, June 02, 2023 10:10:12 AM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
IFB1/2023/07

@Maka what is your prediction for the market-determined coupon rate.
Are we likely to see 14.50%?
MatataMingi
#1643 Posted : Saturday, June 03, 2023 10:48:36 AM
Rank: Member


Joined: 11/17/2009
Posts: 397
Location: Where everyone knows you
The recent 3 year bond had a coupon rate of 14.228%.
Therefore, I think the coupon will be a bit higher, even though it is tax free.
Queen
#1644 Posted : Monday, June 05, 2023 3:23:03 PM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
MatataMingi wrote:
The recent 3 year bond had a coupon rate of 14.228%.
Therefore, I think the coupon will be a bit higher, even though it is tax free.


The prospectus for this bond was done in a hurry. For instance, reading through the article on the amortization, it is not clear how long it will take to redeem in full amounts upto to Kshs 1M.
heri
#1645 Posted : Thursday, June 08, 2023 9:08:53 AM
Rank: Member


Joined: 9/14/2011
Posts: 834
Location: nairobi
I want to put some money in these bonds but I keep wondering if this KK government will eventually default. So much lack of confidence 9 months since they assumed power. Most if not all appointments made have been so disappointing. Can the calibre of such people really get us out of the hole Uhuru left us in or we are just digging
MatataMingi
#1646 Posted : Thursday, June 08, 2023 9:54:04 AM
Rank: Member


Joined: 11/17/2009
Posts: 397
Location: Where everyone knows you
Queen wrote:
MatataMingi wrote:
The recent 3 year bond had a coupon rate of 14.228%.
Therefore, I think the coupon will be a bit higher, even though it is tax free.


The prospectus for this bond was done in a hurry. For instance, reading through the article on the amortization, it is not clear how long it will take to redeem in full amounts upto to Kshs 1M.



I have sought clarification from CBK.
According to them, any amount upto KES 1M, will be redeemed in full during the first redemption on 15/06/2026.
MatataMingi
#1647 Posted : Thursday, June 08, 2023 10:01:01 AM
Rank: Member


Joined: 11/17/2009
Posts: 397
Location: Where everyone knows you
heri wrote:
I want to put some money in these bonds but I keep wondering if this KK government will eventually default. So much lack of confidence 9 months since they assumed power. Most if not all appointments made have been so disappointing. Can the calibre of such people really get us out of the hole Uhuru left us in or we are just digging



I doubt that the Government can risk a default.
There are a lot of investments from local pension and mutual funds.
Plus all local banks have sizeable holdings.

I think that at the most, they will offer switch bonds for maturing bills and bonds, like they have done recently.
Queen
#1648 Posted : Friday, June 09, 2023 10:56:33 AM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
MatataMingi wrote:
Queen wrote:
MatataMingi wrote:
The recent 3 year bond had a coupon rate of 14.228%.
Therefore, I think the coupon will be a bit higher, even though it is tax free.


The prospectus for this bond was done in a hurry. For instance, reading through the article on the amortization, it is not clear how long it will take to redeem in full amounts upto to Kshs 1M.



I have sought clarification from CBK.
According to them, any amount upto KES 1M, will be redeemed in full during the first redemption on 15/06/2026.


I have also called them and they have confirmed your sentiments.

Thank you.

However it is quite worrying that they failed to concisely capture that bit in the prospectus.
Queen
#1649 Posted : Friday, June 09, 2023 11:02:52 AM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
MatataMingi wrote:
heri wrote:
I want to put some money in these bonds but I keep wondering if this KK government will eventually default. So much lack of confidence 9 months since they assumed power. Most if not all appointments made have been so disappointing. Can the calibre of such people really get us out of the hole Uhuru left us in or we are just digging



I doubt that the Government can risk a default.
There are a lot of investments from local pension and mutual funds.
Plus all local banks have sizeable holdings.

I think that at the most, they will offer switch bonds for maturing bills and bonds, like they have done recently.


Secondly, according to the Constitution and the PFM act, public debt is the first charge on the consolidated fund; meaning that the government's first obligation is to clear domestic debts from any revenues raised. In other words, by the time it gets to defaulting on debts, civil/public servants would have gone for months without pay and this government of truthful men, would be on the verge of collapse.
heri
#1650 Posted : Monday, June 12, 2023 9:21:37 AM
Rank: Member


Joined: 9/14/2011
Posts: 834
Location: nairobi
Queen wrote:
MatataMingi wrote:
heri wrote:
I want to put some money in these bonds but I keep wondering if this KK government will eventually default. So much lack of confidence 9 months since they assumed power. Most if not all appointments made have been so disappointing. Can the calibre of such people really get us out of the hole Uhuru left us in or we are just digging



I doubt that the Government can risk a default.
There are a lot of investments from local pension and mutual funds.
Plus all local banks have sizeable holdings.

I think that at the most, they will offer switch bonds for maturing bills and bonds, like they have done recently.


Secondly, according to the Constitution and the PFM act, public debt is the first charge on the consolidated fund; meaning that the government's first obligation is to clear domestic debts from any revenues raised. In other words, by the time it gets to defaulting on debts, civil/public servants would have gone for months without pay and this government of truthful men, would be on the verge of collapse.
I wonder if the same applied to Ghana. Their government did not collapse
Queen
#1651 Posted : Tuesday, June 13, 2023 6:26:33 AM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
MatataMingi wrote:
The recent 3 year bond had a coupon rate of 14.228%.
Therefore, I think the coupon will be a bit higher, even though it is tax free.


Most stockbrokers are predicting a market-determined coupon rate north of 15%. There is good money to be made here.
Interesting.
cnn
#1652 Posted : Wednesday, June 14, 2023 6:48:12 PM
Rank: Veteran


Joined: 6/17/2009
Posts: 1,619
Queen wrote:
MatataMingi wrote:
The recent 3 year bond had a coupon rate of 14.228%.
Therefore, I think the coupon will be a bit higher, even though it is tax free.


Most stockbrokers are predicting a market-determined coupon rate north of 15%. There is good money to be made here.
Interesting.

213 B @15.837%...That tells a story.
Queen
#1653 Posted : Wednesday, June 14, 2023 8:26:34 PM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
cnn wrote:
Queen wrote:
MatataMingi wrote:
The recent 3 year bond had a coupon rate of 14.228%.
Therefore, I think the coupon will be a bit higher, even though it is tax free.


Most stockbrokers are predicting a market-determined coupon rate north of 15%. There is good money to be made here.
Interesting.

213 B @15.837%...That tells a story.


Looks like there might not be the traditional Tap Sale for this one.
Let us make easy money whenever opportunities present themselves.
Queen
#1654 Posted : Friday, June 16, 2023 2:49:03 PM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
heri wrote:
Queen wrote:
MatataMingi wrote:
heri wrote:
I want to put some money in these bonds but I keep wondering if this KK government will eventually default. So much lack of confidence 9 months since they assumed power. Most if not all appointments made have been so disappointing. Can the calibre of such people really get us out of the hole Uhuru left us in or we are just digging



I doubt that the Government can risk a default.
There are a lot of investments from local pension and mutual funds.
Plus all local banks have sizeable holdings.

I think that at the most, they will offer switch bonds for maturing bills and bonds, like they have done recently.


Secondly, according to the Constitution and the PFM act, public debt is the first charge on the consolidated fund; meaning that the government's first obligation is to clear domestic debts from any revenues raised. In other words, by the time it gets to defaulting on debts, civil/public servants would have gone for months without pay and this government of truthful men, would be on the verge of collapse.
I wonder if the same applied to Ghana. Their government did not collapse


You will, inevitably, miss the bus if you keep on asking too many questions.
holycow
#1655 Posted : Tuesday, June 20, 2023 8:16:02 PM
Rank: Veteran


Joined: 11/11/2006
Posts: 971
Location: Home
Queen wrote:

Looks like there might not be the traditional Tap Sale for this one.
Let us make easy money whenever opportunities present themselves.


Yeah, instead there is a tap sale for the three year bond. This must be the third or fourth tap sale.
Queen
#1656 Posted : Wednesday, June 21, 2023 9:35:27 AM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
holycow wrote:
Queen wrote:

Looks like there might not be the traditional Tap Sale for this one.
Let us make easy money whenever opportunities present themselves.


Yeah, instead there is a tap sale for the three year bond. This must be the third or fourth tap sale.



It is the third Tap Sale for this particular Bond.
At a coupon rate of 14.228%, the effective net coupon rate comes down to a mere 12.09%. This is quite unattractive compared to the juicy tax-free 15.837% coupon rate of the recent IFB. To put it in a better perspective, if the IFB was not tax-free, its equivalent FXDI Bond would attract a Coupon Rate of 18.632%. That is how attractive the IFB was.

Anybody who failed to participate in the IFB primary offer expecting to jump in during the tap sale after seeing the coupon rate must be sweating profusely for their miscalculation. Very disappointing to go for a coupon rate of 14.228% only a month after foregoing a juicier "18.632%" coupon rate (or 12.09% rate against a 15.837% rate).

Investing is never easy or rather mathematics is NOT EASY.
Queen
#1657 Posted : Wednesday, June 21, 2023 10:20:44 AM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
Queen wrote:
heri wrote:
Queen wrote:
MatataMingi wrote:
heri wrote:
I want to put some money in these bonds but I keep wondering if this KK government will eventually default. So much lack of confidence 9 months since they assumed power. Most if not all appointments made have been so disappointing. Can the calibre of such people really get us out of the hole Uhuru left us in or we are just digging



I doubt that the Government can risk a default.
There are a lot of investments from local pension and mutual funds.
Plus all local banks have sizeable holdings.

I think that at the most, they will offer switch bonds for maturing bills and bonds, like they have done recently.


Secondly, according to the Constitution and the PFM act, public debt is the first charge on the consolidated fund; meaning that the government's first obligation is to clear domestic debts from any revenues raised. In other words, by the time it gets to defaulting on debts, civil/public servants would have gone for months without pay and this government of truthful men, would be on the verge of collapse.
I wonder if the same applied to Ghana. Their government did not collapse


You will, inevitably, miss the bus if you keep on asking too many questions.
Countries DO NOT collapse like buildings. Look at the inflation rates in Ghana and Sri Lanka.


MatataMingi
#1658 Posted : Saturday, July 08, 2023 3:48:23 PM
Rank: Member


Joined: 11/17/2009
Posts: 397
Location: Where everyone knows you
All T- Bills i.e 90, 182 & 364 days now above 12% interest.
Queen
#1659 Posted : Monday, July 10, 2023 1:00:42 PM
Rank: Member


Joined: 11/21/2018
Posts: 564
Location: Britain
MatataMingi wrote:
All T- Bills i.e 90, 182 & 364 days now above 12% interest.


Let us all accumulate money as we await the next IFB.
MatataMingi
#1660 Posted : Wednesday, July 12, 2023 10:35:36 AM
Rank: Member


Joined: 11/17/2009
Posts: 397
Location: Where everyone knows you
That is what I am doing.
I am investing in 90 day bills on a monthly basis.
therefore, some funds would be available if a juicy bond comes about.
Otherwise, I just rollover the maturing T Bill, and get a better interest.
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