Govt bonds oversubscribed by 37%

Zambia’s government bonds have recorded a significant […]

Zambia’s government bonds have recorded a significant oversubscription of K8.6 billion, just days after the announcement of the general election results.

Earlier this year, the Zambian Business Times (ZBT) reported a period of undersubscription for GRZ bonds, with market experts attributing the decrease to investors favouring short-term instruments such as Treasury Bills during the uncertainty of the election period.

However, the latest bond tender (number 06/2026/ BA) has reversed this trend, attracting K8.7 billion in bids against an initial offer of K6.3 billion, a K2.4 billion or 37% oversubscription. The strong demand was evident across all bond tenors.

The two-year bond received K915 million in bids (face value) compared to the K520 million offered, with K743.5 million allocated at cost. Similarly, the three-year bond saw K1 billion in bids up from K600 million offered, and K788 million allocated.

 The seven-year bond attracted K2.5 billion in bids against a K1.6 billion offer, with K2.4 billion allocated. Longer-dated bonds also saw robust demand. The ten-year bond, offered at K1.7 billion, received K2 billion in bids, with K1.7 billion allocated.

The fifteen-year bond, offered at K1.9 billion, was oversubscribed with K2.2 billion in bids, and the full K1.9 billion allocated. According to Verdricah Langazye, an expert and licensed dealer’s representative at Veste Money, the oversubscription reflects increased investor confidence, particularly as the auction followed the peaceful conclusion of the national elections.

 Langazye noted that interest rates on GRZ bonds have declined in recent months, making bonds an attractive investment opportunity for institutional investors. “Interest rates for GRZ bonds have dropped, and we are seeing institutional investors taking advantage of the favourable environment,” Langazye told ZBT.

She also highlighted that the ability of these instruments to accommodate both local and foreign investors has further enhanced their appeal. “Allowing foreign investors to participate has created a more conducive investment platform and boosted confidence in GRZ bonds,” she added.

 Article by Justine Phiri