The National Treasury has moved to clarify concerns raised in a recent report by the Controller of Budget regarding Treasury Bond interest payments amounting to Ksh53.56 billion for May and June 2025.
In a statement on Tuesday, March 31, Treasury Principal Secretary Chris Kiptoo explained that the National Treasury had fulfilled all its debt servicing obligations within the required timelines.
Kiptoo stated that all payments due to bondholders during the period were honored as scheduled, dismissing any suggestion of delayed or missed payments.
“The National Treasury notes statements contained in the recent report by the Controller of Budget regarding the settlement of Treasury Bond interest obligations for May and June 2025, amounting to Ksh53.56 billion, and wishes to provide clarification to ensure accurate public understanding.
“All Treasury Bond interest obligations for the stated period were settled in full and on time, in accordance with the Government’s debt servicing schedule,” the statement read.
Kiptoo further explained that the apparent discrepancy in reporting arose from how transactions are reflected within the Exchequer system, noting that the payments were facilitated through existing financial mechanisms.
“While the amounts may have appeared outstanding within the Exchequer reporting framework, they were duly financed and settled through the Government overdraft facility at the Central Bank of Kenya, consistent with established cash and liquidity management practices,” the statement added.
According to Kiptoo, the use of the overdraft facility is a routine approach in managing short-term government liquidity needs and does not indicate financial distress or default.
“The utilisation of the overdraft facility is a standard and lawful mechanism for managing short term liquidity within Government operations, as provided for under the applicable legal and institutional framework,” the statement explained.
Kiptoo maintained that at no time were the bond payments overdue, adding that there were no complaints from investors or disruptions in the financial markets.
“At no point were these obligations in arrears. Notably, no claims, complaints, or disruptions were recorded from bondholders or market participants, affirming that all payments were effected as they fell due,” the statement concluded.
