The Treasury plans to issue another mobile-based infrastructure bond (M-Akiba) in the market despite massive undersubscription of the maiden one.
Treasury secretary Henry Rotich blamed prolonged political uncertainty for the 25 per cent subscription of the Sh1 billion offering, which was on sale between June 30 and September 11.
“By and large, we saw a lot of people registering, but they did not take it up partly because people were busy with electioneering period and investment was not so much a focus. The timing was another issue and we should have done this probably after elections,” said Mr Rotich.
“But it is a continuous product and we will continue to come to market because Kenyans now know it more.”
The bond attracted only 5,988 of the 303,534 investors who registered, helping the Treasury raise Sh247.75 million, or 24.78 per cent of the target.
The door was open for bids worth up to Sh3.8 billion for the bond whose minimum investment is Sh3,000, unlike conventional ones where the minimum value is Sh50, 000.
The three-year retail bond offers a return of 10 per cent payable after every six months.
Besides timing, investment analysts also blamed the poor show on inadequate marketing campaigns compared to the pilot Sh150 million launched on March 23.
The pilot issue sold out two days to the April 5 deadline, with daily buys averaging Sh12.5 million.
The average daily buys for Sh1 billion offering was, however, a lowly Sh3.93 million. “Initially, there was some bit of curiosity which is why everybody invested but now you need to sustainably market it so that it becomes a proper investment channel for investors so that the same way you choose a bank, unit trust or land, you should also be thinking of M-Akiba,” Britam Asset Managers chief executive Kenneth Kaniu said in an earlier interview.