Treasury rejects Margaret Nyakang’o’s claim of delay in Ksh53.5B bond payments
By Aloys Michael, March 31, 2026The National Treasury has brushed off reports of delayed payments, affirming that the full Ksh53.56 billion in Treasury bond interest was disbursed promptly and on schedule.
In a statement on Tuesday, March 31, 2026, responding to the claim by the Controller of Budget (COB), Margaret Nyakang’o, the Treasury said the payments were honoured on time.
“This characterisation is inaccurate and potentially misleading. While the amounts may have appeared outstanding within the Exchequer reporting framework, the full obligations were duly settled on the due dates as they fell due in May and June 2025 through the government overdraft facility maintained at the Central Bank of Kenya, in line with established cash management and overdraft operating procedures,” the statement said.
According to the Treasury, the overdraft facility serves as a standard liquidity buffer, allowing the government to bridge temporary cash flow gaps while ensuring critical payments are not disrupted.
Treasury has emphasised that the use of the facility is routine and consistent with established public finance management practices
further noted that any actual delay in settling bond interest would have triggered immediate complaints from investors and market participants.
“Had there been any actual delay in the settlement of these obligations, this would have been immediately evident through complaints or claims from bondholders and market participants. No such occurrences were recorded, affirming that all obligations were met in a timely manner.”
The debt concerns
This comes at a time of heightened scrutiny over Kenya’s debt position, with Parliament raising alarm over increasing borrowing levels and debt servicing costs.
Controller of Budget Margaret Nyakang’o on Monday, March 30, 2026, reported that the Treasury bond interest payments due in May and June 2025 were settled in July, based on Exchequer records, raising concerns over the government’s ability to meet its debt obligations on time.
In her presentation to Parliament, Nyakang’o warned that the country is in a debt trap characterised by a vicious cycle of debt accumulation driven by costly borrowing and poor coordination in project implementation.
She said that by December 2025, public debt had climbed to Ksh12.29 trillion, representing 67.8 per cent of GDP, surpassing the legal limit of 55 per cent.
Moreover, the cost of servicing the debt remains substantial, with interest payments totalling Ksh464.49 billion, 54 per cent of the overall debt service, prompting worries that the principal amount is not declining.
The Treasury, however, emphasised that the government is consistently meeting its domestic and external debt commitments on time.