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Kenya Eurobond 2014
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Intelligentsia
#11 Posted : Wednesday, June 18, 2014 9:08:19 AM
Rank: Elder

Joined: 10/1/2009
Posts: 2,436
And 4X no less!
What an amazing feat-riding roughshod over headlines of a terror attack! Rotich, Min of Fin, Treasury mandarins et al must be one bunch of seriously extremely relieved fellas.

And haiya, I never knew there were 2 tenors ($500m and $1m) , all along I thought it was just one tenor for 10yrs...
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KulaRaha
#12 Posted : Wednesday, June 18, 2014 9:19:05 AM
Rank: Elder

Joined: 7/26/2007
Posts: 6,514
Very good timing, just in the middle of a rally. Well sold, I am pleasantly surprised by the yields..buyers were not too aggressive.

Now, what will they do with the money?
Business opportunities are like buses,there's always another one coming
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Intelligentsia
#13 Posted : Wednesday, June 18, 2014 9:55:24 AM
Rank: Elder

Joined: 10/1/2009
Posts: 2,436
Vital stats, to put the yield in perspective:

Kenya sells $1.5b of 10yr Bond at 6.875%; $500m tenor 5yr bond at 5.875%. Compare with previous issues:

Ghana's Eurobond: $750m 10yr tenor @ 8.0%
Nigeria's: $500m 10yr @ 6.625%
Zambia's: $750m 10yr @ 5.625%
Rwanda's: $400m 10yr 6.875%
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VituVingiSana
#14 Posted : Wednesday, June 18, 2014 3:35:27 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,356
Location: Nairobi
KulaRaha wrote:
Very good timing, just in the middle of a rally. Well sold, I am pleasantly surprised by the yields..buyers were not too aggressive.

Now, what will they do with the money?

Pay Anglo-leasing. http://www.standardmedia...s-billions-of-shillings Note that Kamani has been 'negotiating' but could sue based on the recent payment to Perera.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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VituVingiSana
#15 Posted : Wednesday, June 18, 2014 3:41:03 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,356
Location: Nairobi
Intelligentsia wrote:
Vital stats, to put the yield in perspective:

Kenya sells $1.5b of 10yr Bond at 6.875%; $500m tenor 5yr bond at 5.875%. Compare with previous issues:

Ghana's Eurobond: $750m 10yr tenor @ 8.0%
Nigeria's: $500m 10yr @ 6.625%
Zambia's: $750m 10yr @ 5.625%
Rwanda's: $400m 10yr 6.875%

Rwanda is a small(er) country and raised it when things were rough so Kenya didn't get that great a deal. The currency is managed.

Zambia got a great deal but the Kwacha is crashing/crashed as copper prices tumbled.

Ghana is a perennial over-spender. A pity. The Cedi is trading at 3 per USD from 1.7 per USD when it sold the Eurobond.

Nigeria is in its own league. I don't follow it much. $500mn is not a lot for Nigeria which doesn't need loans if the government officials stop stealing.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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kizee1
#16 Posted : Wednesday, June 18, 2014 9:15:34 PM
Rank: Member

Joined: 9/29/2010
Posts: 679
Location: nairobi
this will make local dollar borrowing become more expensive! quite a number of banks will be left with their pants down
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Intelligentsia
#17 Posted : Monday, June 30, 2014 4:40:20 PM
Rank: Elder

Joined: 10/1/2009
Posts: 2,436
kizee1 wrote:
this will make local dollar borrowing become more expensive! quite a number of banks will be left with their pants down


How, and yet the economy will be suffering a deluge of USD? One would have thought the pricing for USD-denominated facilities will fall - the old tale of (excess) supply vs demand? Fafanua.

Unless you mean local banks will now tie their usd-lendings to the Eurobond pricing?
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  | | Edit by user: Monday, June 30, 2014 4:41 PM | Reason: Not specified
VituVingiSana
#18 Posted : Monday, June 30, 2014 5:01:34 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,356
Location: Nairobi
Intelligentsia wrote:
kizee1 wrote:
this will make local dollar borrowing become more expensive! quite a number of banks will be left with their pants down


How, and yet the economy will be suffering a deluge of USD? One would have thought the pricing for USD-denominated facilities will fall - the old tale of (excess) supply vs demand? Fafanua.

Unless you mean local banks will now tie their usd-lendings to the Eurobond pricing?
Local USD lending is tied to what local banks can borrow USD at not what GoK borrows at. There may be a correlation between what GoK borrows at vs local banks borrow at BUT there is a wide differential on what rates BBK or Citibank can borrow at vs Jamii or Paramount vs DTB or I&M...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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kizee1
#19 Posted : Tuesday, July 01, 2014 9:58:23 AM
Rank: Member

Joined: 9/29/2010
Posts: 679
Location: nairobi
VituVingiSana wrote:
Intelligentsia wrote:
kizee1 wrote:
this will make local dollar borrowing become more expensive! quite a number of banks will be left with their pants down


How, and yet the economy will be suffering a deluge of USD? One would have thought the pricing for USD-denominated facilities will fall - the old tale of (excess) supply vs demand? Fafanua.

Unless you mean local banks will now tie their usd-lendings to the Eurobond pricing?
Local USD lending is tied to what local banks can borrow USD at not what GoK borrows at. There may be a correlation between what GoK borrows at vs local banks borrow at BUT there is a wide differential on what rates BBK or Citibank can borrow at vs Jamii or Paramount vs DTB or I&M...

very few local banks have USD balance sheets many operate a higher loans to depo ratio on fcy,they thus resort to funding thru either fx swaps or borrowing from multinationals
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  | | Edit by user: Tuesday, July 01, 2014 10:02 AM | Reason: Not specified
KulaRaha
#20 Posted : Tuesday, July 01, 2014 10:04:51 AM
Rank: Elder

Joined: 7/26/2007
Posts: 6,514
There is massive demand for USD borrowing among corporates, with very few USD liabilities.

USD lending rates must rise.
Business opportunities are like buses,there's always another one coming
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