The Malian Treasury exceeded its 55 billion FCFA target by securing 60.5 billion FCFA in public securities, indicating strong investor demand despite rising costs.
The Malian Treasury successfully raised 60.5 billion FCFA on September 2nd from the West African Monetary Union's public securities market, surpassing its initial target of 55 billion FCFA. Investor demand remained robust, with offers totaling nearly 68 billion FCFA, representing a coverage rate of 123.61%. The Treasury accepted 60.5 billion FCFA and rejected approximately 7.49 billion FCFA, demonstrating continued regional investor confidence in Malian securities.
However, the cost of this financing is significant, reflected in the yields demanded by investors. The weighted average yield for one-year Treasury bills maturing in September 2027 was 4.89%. For three-year and five-year bonds, the yields were 7.69% and 7.40% respectively, with nominal coupons set at 6% and 6.20%. These higher yields indicate that investors purchased the securities below their nominal value, increasing the effective return.
This operation follows a similar one on August 20th, which raised 55 billion FCFA with slightly lower average yields. In just two weeks, the yield on short-term securities increased by half a percentage point, and three-year bonds rose by fifteen hundredths of a point, suggesting a fluctuating market cost. Separately, the Treasury repurchased 9.05 billion FCFA of an upcoming bond to manage its repayment schedule.
Why it mattersThe Malian government is raising funds through public securities, which affects public finances and the cost of borrowing for the state.
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