A corporate Bond is a fixed income instruments issued by a company in order to raise capital. The corporate Bond Market in Kenya enables companies’ access long term capital at competitive rates enhancing their growth and development.
Requirements to List on the Main fixed income securities market in Kenya
| Listing Requirement | Â Main Fixed Income Securities Market Segment |
| Business operation | At least 5 years |
| Share capital and net assets | Min. issued and paid-up share cap of KES 50m, net assets of KES 100m |
| Profitable historic track record |
Profits before tax in at least 2 of last 3 financial periods preceding application |
| No objection – foreign guarantors |
Foreign bank guarantor shall issue a letter of no objection from regulator. |
| Rating of debt issue | Issuer may be rated by a credit rating agency, with cautionary statement if not rated |
| Issue size and subscription | • Minimum issue size of KES 400m • Minimum subscription of KES 10K |
| Debt Ratios | Total liabilities, including the new issue of fixed income securities shall not exceed four (4) times the level of shareholders funds. |
| Minimum number of bondholders |
100 bondholders |
| Trust Deed and Trustee | Independent trustee registered with CMA; Trust Deed executed before listing |
| Audited financial statements | Last 3 accounting periods; not older than 4 months (6 months if already listed elsewhere) |
Benefits of Main Fixed Income Securities to Issuers and InvestorsÂ
| Benefits for Investors | Benefits for Issuers |
| Corporate Bonds are less risky and less volatile compared to other asset classes. | Ability to raise long term capital at affordable rates to fund growth. |
| Wide array of bonds to enable investors build strong portfolios. | Faster way to raise capital compared to other forms of raising capital. |
| Corporate bonds are liquid offering investors easier exit and entry points. | Access to a wide array of investors. |
Issuances under the Main Fixed Income Securities Market Segment
|
No. |
Issuer |
|
 1.                   |
Family Bank Limited – Medium Term Note (MTN) |
|
 2.                   |
Kenya Mortgage Refinance Company Plc – Medium Term Note (MTN) |
|
 3.                   |
Linzi 003 Infrastructure Asset-Backed Securities – IABS Medium Term Note (MTN) |
|
 4.                   |
East African Breweries Plc Domestic Medium-Term Note (MTN) |
|
 5.                   |
Safaricom Plc Medium Term Note (MTN) |