Standard Chartered Bank Kenya has been appointed to facilitate the purchase and safekeeping of Kenyan government securities for international investors under a new partnership between the Central Bank of Kenya (CBK) and global financial services provider Clearstream.
The agreement establishes a domestic market link that will allow institutional investors to access Kenya’s government bonds, infrastructure bonds and Treasury bills through a single master account, making it easier for foreign investors to participate in the country’s debt market.
Under the arrangement, Standard Chartered Bank Kenya will serve as the link between Clearstream and the CBK, executing transactions through the Dhow Central Securities Depository (DhowCSD). The bank will also act as Clearstream’s local custodian and cash correspondent for the Kenyan shilling.
“The connection provides institutional investors with efficient access to the local market through a unique omnibus account structure, supporting Kenyan government bonds, infrastructure bonds and Treasury bills,” Clearstream’s parent firm Deutsche Börse Group, said in a statement.
“Standard Chartered Kenya will serve as Clearstream’s cash correspondent bank for the Kenyan Shilling and local custodian with the Central Bank of Kenya.”
The deal is expected to expand the pool of investors buying Kenyan government debt while generating additional income for Standard Chartered through its role in processing transactions, foreign-exchange services and settlement.
CBK welcomed the partnership, describing it as a major step towards strengthening Kenya’s financial markets and attracting more global investors.
“The Central Bank of Kenya welcomes the establishment of the Clearstream-Kenya Link, which is expected to provide efficient access by international investors to Kenyan Government securities, supported by the Dhow Central Securities Depository (DhowCSD). This is a significant milestone in developing Kenya’s financial markets,” said David Luusa, Director of Financial Markets at the CBK.
“The link is expected to deepen liquidity, broaden the investor base, and enhance the resilience of the domestic debt market. This development underscores our commitment to strengthening and modernising financial market infrastructure, fostering greater integration with the global financial system, and advancing Kenya’s position as one of the leading financial centers in Africa.
Kenya’s Treasury bills and bonds currently stand at about Sh7 trillion, with foreign investors holding roughly 4.2 per cent of the total. Local banks, insurers and pension funds remain the dominant investors, although retail participation has increased since the introduction of the DhowCSD in 2023.
Deutsche Börse said Kenya;s growing appeal to global investors, supported by steady economic growth and the prospect of inclusion in major global market indices, influenced Clearstream’s decision to establish the new market link.
“This momentum is further reinforced by Kenya’s expected inclusion in global market indices and underscores its rising prominence among international investors. The new link addresses this growing demand, enabling capital to flow more easily into one of the continent’s most promising markets,” the multinational said.
The Kenyan link becomes Clearstream’s 60th domestic market connection and enables international investors to settle, hold and manage Kenyan government securities through a single access point without opening local accounts.
