How Trump’s Govt Move is Set to Slash Kenya’s SGR Debt

Hello and welcome to the Money News Roundup, where we cover how Kenya could benefit from SGR loan reduction as Trump's government cuts rates. We also cover the latest report on ghost students in schools.

How Trump’s Govt Move is Set to Ease Kenya’s SGR Debt

The US Federal Reserve is set to cut interest rates for the first time this year, a move expected to ease Kenya’s debt burden tied to the Standard Gauge Railway (SGR) and syndicated loans.

The anticipated 0.25% point rate cut by the Federal Open Market Committee (FOMC), under pressure from President Donald Trump, will lower the Fed funds rate, further influencing the Secured Overnight Financing Rate (SOFR), a key global benchmark.

Kenya’s SGR and syndicated loans, totaling Ksh982 billion, are pegged to SOFR. Lower SOFR rates would reduce debt servicing costs. 

As reported in the Business Daily, Treasury is projecting Ksh129 billion in SGR payments and Ksh83.49 billion in syndicated loan repayments this fiscal year.

 Kenya’s debt repayments this financial year are set to account for Ksh1.9 trillion, which is 44% of the national budget.

Treasury CS John Mbadi noted that SGR  and syndicated loans are major fiscal pressures, with some of the loans attracting interest rates between 12% and 14%.

To further ease the burden, the Treasury is negotiating with China to convert SGR loans from dollars to Chinese Yuan, which would shift to a lower fixed interest rate, potentially halving current costs.

Uber Launches Safari Booking Service for Nairobi National Park

Uber has launched a new service, Uber Safaris, which allows users to book game drives to Nairobi National Park directly through its app. Uber has partnered with the Kenya Wildlife Service (KWS), Tourism Regulatory Authority, and Magical Kenya to roll out the service.

The service, available only in Nairobi, costs Ksh25,000 for daytime tours (up to 7 people) and Ksh40,000 for night tours (up to 5 people). Rides are in extended-wheelbase Land Cruisers operated by licensed safari companies.

As reported in the Business Daily, bookings can be made up to three months in advance, with a 2-day notice for daytime and a 5-day notice for night safaris. 

Users of the new service will pay park entry fees directly to KWS. 

10% of Students Found to be ‘Ghosts’ in School Audit

The ongoing school data verification exercise has uncovered ghost learners and schools, prompting the Ministry of Education to predict a 5% to 10% drop in student numbers and a potential reduction in schools. 

As reported by Citizen Digital, Basic Education PS Julius Bitok confirmed that 20,000 out of 32,000 schools have been verified, with capitation disbursed to them. 

However, many schools are yet to receive funding, affecting operations. The release of funds has been tied to verification of enrollment, management, and bank details.

So far, Ksh13 billion of the Ksh23 billion capitation has been released. The exercise, briefly disrupted by internet issues, is expected to conclude by Friday, with verification still ongoing.

MPs Launch Probe into Sale of East Africa Portland Cement Shares

Parliament’s Trade, Industry and Cooperatives Committee has launched a probe into the planned sale of a 29.2% stake in East Africa Portland Cement (EAPC) to Kalahari Cement Limited, amid claims the deal is progressing without management or employee involvement.

As reported in the Eastleigh Voice, Chair Benard Shinali and Vice Chair Marianne Kitany raised concerns over secrecy, warning of risks to taxpayers, workers, and local communities. 

“This is not just any private company. Kenyans, through their pensions and taxes, own a majority of this firm. Due diligence must be done, and employees and local communities must be involved,” Kitany said.

As a result, MPs want EAPC to buy back the shares and sell them at a later time at a profit.

Bond Investors Reap Ksh101B Profit Amid Falling Interest Rates

As reported in the Business Daily, Treasury bond investors recorded an eight-fold surge in profits to Ksh101.4 billion in the six months to June 2025, driven by rising bond prices at the Nairobi Securities Exchange (NSE).

Data from the Capital Markets Authority (CMA) show that investors bought bonds worth Ksh1.28 trillion at face value and sold them for Ksh1.39 trillion. 

Falling interest rates following Central Bank of Kenya (CBK) benchmark rate cuts from 13% in August 2024 to 9.5% boosted bond valuations, pushing demand to the secondary market. 

High-yield infrastructure bonds were most sought after, with an 8.5-year paper issued in February 2024 trading at Ksh122 against its Ksh100 par value due to its 18.46% coupon.

Stanchart Issues Profit Warning on Looming Ksh7B Pension Payout

Standard Chartered Bank Kenya has issued a profit warning, projecting its 2025 net earnings will fall at least 25% below 2024 levels due to a looming multibillion-shilling pension settlement. 

Board Chair Kellen Kariuki stated that the payout resulting from a Retirement Benefits Appeals Tribunal ruling involved 629 former employees and potential liability exceeding Ksh7 billion.

The bank’s H1 2025 profit dropped 21.4% to KSh8.09B as net interest income fell 7.4% and non-interest income declined 29.1%, cutting operating income by 15.3%. Read More.