In a bid to support the development of the capital market and raise long term funds to finance its activities, government on Friday issued a third Treasury bond. This becomes the fourth instrument to be listed on the Rwanda Over- The-Counter (OTC) market in a period of just two months since the Rwanda capital market was launched on January 31. It follows two treasury bonds and one corporate bond.Unlike the two treasury bonds that have been on the secondary market, the third Treasury bond carries interest rate of 8.25 per cent and has maturity period of 3 years. The two treasury bonds originally on the OTC market had interest rate of 8 per cent each and they both were to mature after two years. The new government debt instrument on the OTC market was over subscribed by 44 per cent on the primary. The implication is that the subscribers offered much money than the National Bank of Rwanda (BNR) was targeting. Government was targeting to collect Frw5 billion from the issue of this bond on primary market but it got Frw7.27 billion. Robert Mathu, executive director of Rwanda capital markets advisory council urged Rwandans to invest in the securities listed on the OTC market. Mathu argues that the primary advantage of these securities is safety. He says that it’s not easy for other investments to carry that guarantee as assured by the financial securities. The strong guarantee is given as that interest and principal will be paid on time. Ends
