The Nairobi Securities Exchange (NSE) on Wednesday suspended trading of the Sh150 million mobile phone-based bond to prevent fraud following a system breakdown.
The trading of the bond in the secondary market stopped just 24 hours after it was launched.
Market insiders said the action was taken after reconciliation delays, seen to make it possible for investors who had placed sale orders to receive payment while still retaining ownership of the papers were discovered.
“Secondary trading of M-Akiba has been temporarily stopped due to a communications hitch between trading and depository systems, which caused delay in settlement of trades,” a senior Treasury official said, adding that engineers were working around the clock to resolve the issue.
The Treasury raised Sh150 million through the mobile phone-based three-year M-Akiba bond days before the offer closed on April 5.
This pilot digital bond sale was meant to test the waters and whet the appetite of investors ahead of the Sh4.85 billion offer which President Uhuru Kenyatta is expected to launch in June.
The digital bond trading system sits at the NSE but is fundamentally distinct from the one used to trade normal stocks.