Kenya issues 10-year Eurobond worth Sh194 billion to ease debt repayment

National Treasury officials led by Cabinet Secretary John Mbadi during a press briefing on February 13, 2025. (Photo: National Treasury)

By Lucy Mumbi
Thursday, February 27, 2025

CS Mbadi said the proceeds from this bond will be used to refinance existing external debt, including a planned buyback of a US$900 million (Sh116.3 billion) Eurobond set to mature in 2027.

Kenya has secured a new Sh194 billion (US$1.5 billion) Eurobond with a 10-year maturity, aimed at refinancing its existing debt, Treasury Cabinet Secretary John Mbadi has announced.

Mbadi said the proceeds from this bond will be used to refinance existing external debt, including a planned buyback of a US$900 million (Sh116.3 billion) Eurobond set to mature in 2027.

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The bond, which carries a 9.5 per cent coupon rate, will be amortised in three equal installments in 2034, 2035, and 2036.

He noted that the weighted average life of the bond is 10 years, allowing Kenya to smoothen its debt repayment profile. The issuance attracted significant interest from international investors, with the order book exceeding US$5 billion (Sh646.2 billion).

Sustainable debt portfolio

“This transaction follows the successful issuance of the 2031 Eurobond in February 2024 and the full repayment of the 2024 Eurobond,” Mbadi said.

“It aligns with our goal of ensuring a well-structured and sustainable debt portfolio.”

He added that the final amount for the buyback of the 2027 Eurobond will be determined based on investor demand in an ongoing tender offer, with results expected on March 3, 2025.

The Treasury noted that this issuance is part of the government’s broader effort to proactively manage public debt and strengthen Kenya’s financial position in global markets. The success of the Eurobond highlights investor confidence in the country’s economic management and policy framework.

“The government remains committed to prudent public debt management, which is a key pillar of the Bottom-Up Economic Transformation Agenda (BETA) championed by President William Ruto,” Mbadi said.

“This pricing marks another milestone in advancing our economic agenda.”

He emphasised that Kenya’s ability to attract strong investor interest in its Eurobonds highlights the continued trust in the country’s fiscal policies and its commitment to maintaining stability in the international financial market.