T-bill rates fall across the board

The Bureau of the Treasury fully awarded the treasury bills offered during the last auction of the third quarter, at rates that fell across the board.

The Treasury sold a total of P20 billion in T-bills—P8 billion in 91-day debt paper, P6 billion in 182-day IOUs, and another P6 billion in 364-day government securities.

The auction was oversubscribed, with a total of almost P52.5 billion in tenders.

“The offering was met with strong demand with bid-to-cover ratio of more than 2.5 times across all tenors on offer,” the Treasury said in a statement.

For the 91-day treasury bill maturing on Dec. 28, the average rate fell to 1.321 percent from 1.479 percent a month ago.

The rate for the 182-day T-bill maturing on March 29 next year, meanwhile, declined to 1.439 percent from 1.474 percent last month.

As for the 364-day IOUs maturing on Sept. 27 next year, the annual rate was 1.683 percent, down from 1.724 percent at the previous auction.

The rates at which the T-bills were sold were all “lower than than prevailing secondary benchmarks, and all lower than the averages of the August T-bill auctions,” the Treasury noted.

The Treasury is still firming up the domestic borrowing program for the fourth quarter, National Treasurer Roberto B. Tan told reporters last week.

The government had programmed to sell P135 billion in treasury bills and bonds per quarter during the first three quarters.

Early this month, the government sold a total of P100 billion in retail treasury bonds (RTBs) or more than triple the minimum P30-billion offering, citing “considerable demand for the securities in the order books of the authorized selling agents” during the public offer period and roadshows conducted nationwide on Sept. 6-16.

The fixed interest rate for the 10-year debt paper maturing in September 2026 was set at 3.5 percent.

Tan had said that the total amount of RTBs issued was “expected,” as the Treasury was “confident of achieving that, especially under an administration that’s very credible.”

The volume sold was “a balance that we made depending on our desired cash positions and, of course, projections of cash flow in the future, and the demand-side, which is the submissions of bids by different investors for this security,” according to Tan. Ben O. de Vera