RTB sale raises outstanding debt to P6.37 trillion in April

INQUIRER FILE PHOTO

MANILA — The successful sale of P181 billion in retail treasury bonds to small investors last month raised the national government’s outstanding debt by 2.9 percent month-on-month to P6.37 trillion as of the end of April.

The latest Bureau of the Treasury data showed that the national government debt rose from P6.19 trillion in March as well as increased 8.3 percent from P5.884 trillion at the end of the first four months of last year.

As of April, debt sourced from domestic sources accounted for the bulk or 65 percent of the outstanding amount, while the remainder were borrowed externally, the Treasury said in a statement.

“Domestic debt amounted to P4.16 trillion, up 4.8 percent [month-on-month]. Domestic debt levels were driven by the net issuance of government securities amounting to P192.48 billion, including P181 billion in three-year RTBs,” the Treasury explained.

The Treasury awarded P70 billion in RTBs to banks during the rate-setting auction on March 28, while the general investing public snapped an additional P111 billion during the public offer period last March 28-April 7.

The Treasury had said the RTBs attracted a total of P500 billion in tenders, making the IOUs oversubscribed by over 16 times the initial issue size of P30 billion.

For the government’s 19th RTB issuance, the coupon rate was set at 4.25 percent for the bonds maturing on April 11, 2020, higher than the 3.5 percent yield for the 10-year RTBs sold in September last year.

But the Treasury said the increase in the end-of-April domestic debt “was slightly tempered by the stronger peso, which reduced the value of onshore dollar bonds,” noting that the peso bounced back to an average of 49.9:$1 that month from March’s 50.219:$1.

Meanwhile, foreign debt declined 0.5 percent month-on-month to P2.21 trillion.

“Factors causing external debt to slightly increase for the period include the revaluation in third currency-denominated debt worth P320 million and net availments amounting P2.01 billion. However, these were dwarfed by the effect of the stronger peso, which reduced the value of external obligations by P14.11 billion,” according to the Treasury.  SFM