BoU’s 15-year Treasury Bond oversubscribed amid strong investor confidence

The Bank of Uganda’s (BoU) latest Treasury Bond auction attracted robust investor demand, with the 15-Year Reopening Bond drawing massive oversubscription and signaling renewed confidence in the government’s long-term debt instruments.

The auction, conducted on October 1, 2025, featured re-openings of the 2-Year, 5-Year, and 15-Year benchmark bonds, with settlement scheduled for October 2.

The standout performer was the 15-Year Treasury Bond (ISIN: UG12K2306393, 15.800% due June 23, 2039), which received tenders worth UGX 2.48 trillion, far exceeding the offered amount of UGX 430 billion—a bid-to-cover ratio of 1.03. Accepted bids totaled UGX 2.41 trillion, with a yield at the cut-off price of 17.650% and a cut-off price of UGX 94.103 per 100.

Analysts said the overwhelming participation reflects deep liquidity in the financial system and sustained appetite for higher-yield, long-term government paper.

The 2-Year bond (UG12J1301280, 14.125% due January 13, 2028) was also oversubscribed, attracting tenders worth UGX 299.28 billion against an offer of UGX 230 billion. Of this, UGX 152.03 billion was accepted, at a cut-off yield of 15.750% and a cut-off price of 99.898. The bid-to-cover ratio stood at 1.97.

The 5-Year bond (UG12H0108300, 15.500% due August 1, 2030) similarly recorded strong participation, with UGX 391.04 billion tendered against an offer of UGX 330 billion. Accepted bids totaled UGX 170.62 billion, yielding 16.200% at a cut-off price of 100.031, with a bid-to-cover ratio of 2.29.

Competitive and Non-Competitive Bids

All three bonds recorded healthy participation from both competitive and non-competitive investors.

• 2-Year Bond: Competitive bids totaled UGX 298.30 billion, with UGX 151.05 billion accepted. Non-competitive bids of UGX 979.3 million were fully accepted.
• 5-Year Bond: Competitive bids amounted to UGX 388.80 billion, of which UGX 168.38 billion was accepted. All UGX 2.24 billion in non-competitive bids were accepted.
• 15-Year Bond: Competitive bids reached UGX 2.47 trillion, with UGX 2.40 trillion accepted. Non-competitive bids totaled UGX 13.58 billion, all accepted.

The Bank of Uganda said the results point to continued investor confidence in Uganda’s domestic debt market, supported by attractive yields and stable macroeconomic indicators.

Market participants noted that the strong subscription, particularly for the long-term bond, suggests institutional investors are positioning for long-duration assets amid expectations of moderate inflation and currency stability.

The auction outcome reinforces BoU’s efforts to deepen the secondary market for government securities and maintain predictable issuance across maturities.

Settlement for all accepted bids was October 2, 2025.