Kuwait's central bank said it would issue KWD80 million ($275.1m, Dh1 billion) worth of one-year treasury bonds tomorrow carrying a coupon of 2.25 per cent, the fifth issue this year amid strong demand.
Central bank data showed yesterday that the bond issue, which matures on April 7, 2010, received KWD674.5m of bids.
The last issue was on March 25 for a KWD92m worth of treasury bonds with the same coupon, which received bids worth eight times its amount as banks look to ways to soak up excess cash.
Last month, Governor Sheikh Salem Abdul Aziz Al Sabah said there is excess liquidity in the state that the central bank was "mopping up".
Kuwaiti banks have become prudent after the state was forced to step in and rescue one of the country's biggest banks, Gulf Bank , last year, and as they await the implementation of a $5bn stimulus package. The cabinet has approved a bylaw to implement the $5bn stimulus package, which will come into effect once it is published in the official gazette.