BTr awards P20B in T-bills

The Bureau of the Treasury (BTr) yesterday fully awarded P20 billion in T-bills on the back of the strong demand for short-term government securities.

The BTr received a total of P39.72 billion in tenders for the IOUs it offered, making the auction oversubscribed by almost twice.

It said it had opted for a full award due to the “healthy market appetite.”

For the benchmark 91-day treasury bills, P8 billion were accepted out of the P23.23 billion tendered. The yield for the IOUs maturing on June 15 dropped to 1.469 percent from 1.513 percent last month.

“Auction results revealed strong preference for the shorter-dated 91-day securities as average rates went down from the previous month,” the BTr noted.

It had received P8.34 billion in bids for the P6 billion worth of 182-day T-bills it offered. The average rate for the debt paper maturing on Sept. 14 rose to 1.589 percent from 1.508 percent during the previous auction.

As for the 364-day treasury bills, investors tendered P8.15 billion for the P6-billion offering. The yield for the IOUs maturing on March 15 next year went up to 1.75 percent from 1.678 percent at last month’s auction.

“The slight rise in the rates of the 182- and 364-day bills was consistent with the overall market tone,” said the BTr.

On March 29, the BTr will auction off P25 billion in three-year T-bonds as part of the P135-billion domestic borrowing program for the first quarter.

Last month, the Philippines sold $2 billion worth of 25-year global bonds at a record-low yield of 3.7 percent, which the government said reflected sustained investor confidence in the country despite volatile markets.

The coupon for the US dollar-denominated sovereign bonds maturing in 2041 was not only lower than the initial pricing guidance of 4 percent but also the lowest ever for an offshore issuance.

Of the proceeds, $500 million will be infused into the budget, while $1.5 billion will be switched to retire previously issued IOUs maturing between October this year and October 2034.

The government had programmed to borrow P674.8 billion this year, lower than last year’s P710.8 billion to slash the debt stock or the share of outstanding debt to the gross domestic product to a record-low of 41.8 percent.

In 2016, domestic borrowing would compose 85 percent of the total or P570.2 billion. The government would also borrow P104.6 billion from foreign sources—P54.1 billion in program loans, P17.1 billion in project loans, and P33.4 billion in bonds and other inflows.