Asset servicing - Kenya
Reference
The Kenyan market follows standard practices for income collection and redemptions across government securities. Income events include interest payments and redemptions on fixed income instruments.
The single source of reference data related to income events for government securities is the Central Bank of Kenya National Debt Office. The information is included in the prospectus at the point of issuance of the securities.
The Central Bank of Kenya acts as Depository, Registrar, Paying Agent and Withholding Tax Agent for government securities. Our custodian will send all notifications based on their records.
Income collection
Entitlements are determined based on the settled positions on record date.
For government securities, all details including the coupon rate, pay date, tax rate and maturity are set out in the prospectus at the time of issuance; the payment date is equal to record date plus 3 working days. Interest is calculated days182/364 and paid in Kenyan Shillings (KES) by the Central Bank of Kenya on payment date.
Government securities coupon payments occur semi-annually.
Contractual income services are not available in this market.
| Service offered | Remarks |
| Notification to clients | |
Standard Asset Servicing reporting via Swift MT56x, Xact Web Portal and Xact File Transfer. | See Section 8 “Asset servicing” of the Client Handbook. See Connectivity manuals on the Clearstream website. |
| Payment of proceeds | |
Proceeds are calculated based on the settled positions on the record date and paid to the client's account upon successful receipt and reconciliation of funds. Proceeds will be paid with the value with which they are received. Proceeds are paid net. The payment method to be applied is reported via MT564 IPAR and Xact Web Portal IPAR. All income proceeds are paid in Kenyan Shillings (KES), with the following rules:
| The custodian has a maximum 24-hour turnaround time to send information and to make payments to Clearstream. For further details on entries qualified as ACL, please refer to the section “5.6 Financing: availability of funds” of the Client Handbook. |
Repatriation of funds
The KES is fully convertible currency and can be freely traded against any other hard currency.
There are no restrictions on the funds transfer of KES in and out of Kenya for investment purposes.
Asset Servicing Events
Asset Servicing Events for Government securities refer to events initiated by the Central Bank of Kenya, which typically encompass the following:
- Coupon Payment
- Maturity and Principal Repayment
- Re-opening of Bonds (Central bank of Kenya may re-open a previously issued Government Bond to raise additional funds)
- Buybacks and Switch Auctions (in a switch auctions, investors exchange an old bond for a new one with a different maturity or yield)
- Restructuring or Debt Conversion
- Early redemption (Call Option, some Government Bonds may have an option to the National treasury to redeem them before maturity)
