The Nairobi Securities Exchange (NSE) recorded an unprecedented Ksh.2.7 trillion in bond trades in 2025, marking the highest annual turnover in the exchange’s history and nearly doubling the Ksh.1.5 trillion recorded in 2024.
According to the Business Daily report, the record performance in the secondary bonds market reflects rising investor participation, particularly in response to falling interest rates.
As yields on newly issued government securities declined, investors increasingly sought older high-interest bonds issued in 2023 and 2024, which are now commanding significant price premiums in the secondary market.
Market analysts attributed the uptick to investors pivoting toward secondary trading to secure favourable yields and capital gains, rather than investing in new issues with lower prospective returns.
Retail Investor Participation on the Rise
In addition to the strong bond market performance, the NSE’s equities turnover climbed 37.3 percent to Ksh.145 billion, further demonstrating heightened trading activity across financial markets in Kenya.
The growth in secondary bond trading has been supported by increased retail investor engagement, driven in part by the Central Bank of Kenya’s Dhow CSD digital platform.
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Dhow CSD digital platform has simplified access to government securities since its launch in 2023.
Households now own Ksh.437.7 billion worth of government debt, accounting for roughly 6.4 percent of the State’s Ksh.6.84 trillion domestic debt portfolio.
Foreign investors, non-financial corporations and nonprofit organisations also hold substantial portions of government debt, contributing to the diversity of market participation.
Profitability for Market Intermediaries
The rise in trading volumes has translated into stronger financial results for investment banks and stockbrokers. In the first six months of 2025, the combined net profit for market intermediaries jumped 156 percent to Ksh.1.1 billion, driven by a 49 percent increase in brokerage commissions.
Leading firms such as Dry Associates, Standard Investment Bank and Faida Investment Bank reported significant brokerage earnings, while NCBA Investment Bank recorded strong net profit performance from a mix of fund management and trading services.
