Rwanda's 21.7 mln USD treasury bond oversubscribed
29 August 2014, 09:36
Nairobi - Rwanda's 21.7 million U.S. dollars Treasury bond has
been oversubscribed by 232 percent, attracting bids worth 50.4 million
The National Bank of Rwanda (BNR) received 91 bids
for the bond issued on Wednesday from different categories of investors
far above the 56 received in the February issuance.
Retail investors, including small and medium enterprises (SMEs) and
individuals, increased to 39 up from 29 in the previous issuance.
Over 6.1 percent of the total bids were from foreign investors from
Canada, France, Belgium, Mauritius, Kenya and Tanzania, according to
Addressing journalists in Kigali on Thursday, BNR governor John
Rwangombwa said the bond's final price was 12 percent with a coupon rate
of 11.875 percent.
The initial guidance price was announced at upper 11 before it was later revised to 11.875 percent, according to the governor.
Finance minister Claver Gatete said the response indicates investors'
confidence in the macro-economic framework and Rwanda's economic
"To have this bond subscribed by 232 percent with wide participation
is a clear indication of how investors perceive our economy," he said.
"Our aim is to ensure that we keep this trend by continuing our prudent
The minister attributed the overwhelming response to the far-
reaching public awareness campaigns that were conducted through
countrywide road shows.
The bond is the third in a series of local treasury bonds issued by
the Rwandan government expected to fund infrastructure projects in the
The government is planning regular issuances of government bonds,
Gatete said, with the next issuance expected in November this year.
Government would also go back to the international bond market next
year after identifying how much is needed for the country's large
infrastructure projects like Bugesera International airport. Rwanda
raised 400 million dollars from the Eurobond it issued in 2013 whose
proceeds were spent on expanding RwandAir's fleet, completion of the
Kigali convention center and the Nyabarongo hydro power project.
Rwanda's Fitch Rating was recently upgraded from B to B+ which could
have influenced the response, according to economic experts.
After announcing the bond subscription, what follows is the allotment
process which could be complete on Friday, officials explained, and
have the bond listed on the stock exchange Tuesday next week. The bond
will go to the secondary market on September 2.
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