Gov’t IOUs down to P3.77T at end-April

The total amount of outstanding government-issued securities further declined to P3.77 trillion at the end of April as more T-bonds and T-bills matured that month.

The latest Bureau of the Treasury data showed the amount at the end of the first four months was lower than the P3.84 trillion posted at end-March.

The bulk of the government IOUs was comprised of treasury bonds, with a face value totaling P3.49 trillion, down from P3.56 trillion a month ago.

Outstanding treasury bills, meanwhile, amounted to P278.5 million, slightly below the P278.9 billion recorded at the end of the first quarter.

Last month, the Treasury awarded all P25 billion in newly issued seven-year T-bonds at a coupon rate of 3.5 percent, while it sold only P16.35 billion of the P20-billion T-bills offered as yields rose across the board.

Of the outstanding T-bonds, three-year IOUs amounted to P50.8 billion; five-year debt paper, P251.4 billion; seven-year treasury bonds, P519.1 billion; and 10-year T-bonds, P362.6 billion.

For the 10-year agrarian reform bonds, the outstanding amount totaled P6.9 billion; 20-year IOUs, P298.3 billion; and 25-year debt paper, almost P236 billion.

Of the $6.582-million Philippine Par Bond redenominated into 28.5 years, P97.1 million remained outstanding.

There were also P725.7 billion worth of outstanding retail treasury bonds; P965.8 billion in benchmark bonds; P50 billion in 25-year CB-BoL T-bonds; and P23.4-billion onshore dollar T-bonds.

As for the outstanding T-bills, P89 billion was from the auction of 91-day IOUs; P89.4 billion from 182-day debt paper; and P100.1 billion from 364-day treasury bills.

The Treasury will sell at an auction P20 billion in T-bills—P8 billion of the benchmark 91-day, P6 billion in 182-day and P6-billion 364-day government securities—on June 6. As for T-bonds, P25 billion will be offered on June 28.

The government had planned to borrow domestically, through the sale of treasury bills and bonds, a total of P135 billion during the second quarter.

Despite the implementation of the Bangko Sentral ng Pilipinas’ term deposit auction facility under the interest rate corridor scheme, the Treasury would still continue to sell T-bills and T-bonds, National Treasurer Roberto B. Tan said last week.

“There would always be appetite [for Treasury IOUs] because the interest rate corridor was really on the shorter end of the curve for sovereign financial instruments,” Tan had said, noting that the term deposit auctions would have tenors of seven and 28 days.

“The government would still be issuing [debt paper with longer tenors] since T-bills and T-bonds were complementary and they reinforce the yield curve from the shortest to the longest,” Tan earlier said.