Kenya’s bond trading developing fast

Andre DeSimone, Kestrel Capital stockbroker, Nairobi
The Nairobi capital market has seen a lot of volatility and many local institutions pulled out. At one point, foreigners made up 80% of trading volume. Local retail investors were out and have not yet come back, the local institutions were out and only came back last month. It has been an emotional response, the cash flow on companies did not change.
The bond market has come to the Nairobi SE and trading has been growing. There have been some teething problems, it will take several months to get all smooth, but we already seen a 5-fold increase in trading. We expect this to grow, in last 3-4 months have seen lots of interest from London and SA investment banks into Kenyan bonds, also for the local currency debt markets.
In order to manage risk, foreign investors are looking for liquidity and only a few markets can provide the right size of deals.

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