Make a solid and assured investment with Equity Bank Treasury Bonds. They are issued by the Government for purchase by investors, offering a periodic fixed return.
- It offers secure investment as it is issued by the Government of Kenya
- It offers liquidity. In the case you require part/ whole of your capital investment, you can sell the bond to other investors.
- Guaranteed earnings. The interest rates earned on an annual basis are market determined and paid out semi-annually making them a fixed source of income.
- Bonds provide a higher return than term deposits for a similar tenor.
- Bonds pay out regular Coupon (Interest) income to Investors by the terms of the bond contract.
- The price of the Bond can appreciate above the initial purchase price and allow investors to enjoy Capital gains.
- Investors can access a loan facility and use the Bond as collateral.
Equity Bank Treasury Bonds Requirement
- A CBK C.D.S (Central Depository Securities) Account through Equity Investment Bank.
- A fully executed Investment Agreement document, Kenyan ID/Passport, K.R.A pin, and Passport size photo.
Types of Treasury Bonds in Kenya
There are different types of treasury bonds classified depending on the purpose of the bond and the structure of the interest rates.
Here is a low down on the bonds to expect across the investment spectrum in Kenya.
1. Fixed coupon or rate bonds
The rate of interest or coupon is fixed over the life of the bond
2. Zero-coupon bonds
These bonds do not pay interest but are usually sold at a deep discount and redeemed at par. The difference between the discounted price and the redemption price is your return.
3. Floating rate bonds
These are bonds whose coupon rate varies depending on the prevailing market conditions
4. Infrastructure (specific project) bonds
These are bonds issued purposely to help the government raise money to fund infrastructure projects across the country. A good example is the M-Akiba bond.
5. Restructuring or special bonds
These are bonds issued to help the government recapitalize or pay off maturing debt. Special bonds are issued for a specific purpose such as funding a designated hospital or railway project.
6. Amortized & Savings development bonds
These bonds are mostly issued for budgetary support
Having said that, the Central Bank of Kenya predominantly issues fixed coupon bonds and infrastructure bonds.