BTr sells P18.4B in Treasury bills

The Bureau of the Treasury on Monday sold P18.4 billion in T-bills after it capped the rate on the benchmark 91-day debt paper as investors sought longer-term securities to offset higher funding costs.

The Treasury only sold P4.4 billion out of the P6 billion in three-month IOUs it offered at an average rate of 5.534 percent, up from 5.418 percent last week.

It also awarded P6 billion in 182-day treasury bills at 5.892 percent, down from 5.914 percent during the previous auction.

As for the P8 billion in 364-day T-bills, the Treasury sold them at 5.964 percent, slightly down from last week’s 5.969 percent.

In all, investors tendered a total of P37.3 billion out of the P20-billion offering, making the auction almost twice oversubscribed.

“We see that there’s already the flow going into the longer tenor. And also we see the lower submissions for the 91-day because right now, the cost of funds of the banks is still higher, so they are trying to max out to make sure that they are able to offset the higher cost of funding,” National Treasurer Rosalia V. de Leon told reporters after the auction.

De Leon noted that investors were “trying also to make sure that the yields where they invest will be able to make up for the higher cost of fund of the bank.”