The Rwf15 billion Treasury bond (TB) issued by the central bank on Wednesday has attracted more retail investors compared to the one issued in November.

Of the 62 applications the National Bank of Rwanda (BNR) received for the three-year TB, 39 were individuals and Savings and Credit Cooperatives (Saccos), representing 2.41 per cent of the total amount offered.

Individual applicants were 22, while 17 were Saccos, BNR said in a statement on Tuesday. Banks and non-financial institutions were allocated the larger share of the bond, scooping 48.09 and 49.5 per cent, respectively.

Just over 1.4 per cent retail investors participated in the November issue, of which 10 were Saccos.

The money raised from the bond issue will finance infrastructure projects and capital market development. The TB was oversubscribed by 106 per cent and has a coupon rate of 11.55 per cent, with a yield rate of 11.7 per cent, according to a Central Bank statement.

The bond will be listed on the Rwanda Stock Exchange secondary market on Tuesday next week. The central bank will plan the next issuance for this financial year in May. It will have a 10-year maturity period.

Compared to the three previous government bonds issued during the past year under a quarterly issuance programme, the bond’s yield rate, the amount of return an investor realizes on a bond, is the third highest.

The first issuance, a three-year Rwf12.5 billion bond issued in February last year secured its yield rate at 11.625 per cent while the second worth Rwf15 billion issued in August last year had a 12 per cent yield rate and the third, seven year Rwf15 billion bond issued in November had its yield decided at 12.5 per cent.

Price-wise, the current bond has been set at Rwf99.627 per bond, a similar price range as the three previous Treasury bonds of Rwf102, Rwf105 and Rwf99.87 per bond, respectively.

The yield of a bond is inverse to its price in that as prices increase, bond yields fall. An investor continues to receive the same amount of interest given by the coupon rate, since the interest is based on the bond’s par value, but gets a higher yield when the bond price falls.