Gov’t to borrow P 420B via T-bills, T-bonds auctions in 1st quarter

National Treasurer Rosalia de Leon / INQUIRER FILE PHOTO

The Philippines will borrow locally—through the sale of treasury bills and bonds—a total of P420 billion in the first quarter of next year, higher than the borrowing programs in the same period and in the last quarter of this year.

This is in line with the government’s program to ramp ‍‍‍‍‍ up borrowings to a record high ‍‍‍‍‍ in 2020.

In a Dec. 23 memorandum to all government securities eligible dealers, National Treasurer Rosalia de Leon said the Bureau of the Treasury would auction off P240 billion in T-bills and P180 billion in T-bonds between January and March next year.

For the treasury bills, a total of P20 billion—P6 billion each in the benchmark 91-day and 182-day, on top of P8 billion in 364-day—will be offered weekly for 12 consecutive Mondays starting Jan. 6 until March 23.

The Treasury will also sell P30 billion each of the following : three-year T-bonds on Jan. 7 and March 3; five-year bonds on Feb. 4; seven-year bonds on Jan. 21 and March 17; and 10-year bonds on Feb. 18.

The first-quarter 2020 domestic borrowing program was higher than the P360 billion intended to be issued in the first quarter of this year and P220 billion in the fourth quarter.

De Leon earlier told the Inquirer that the Cabinet-level Development Budget Coordination Committee this month kept the 2020 borrowings program at a record P1.4 trillion.

As such, the national government’s outstanding debt was expected to reach a record high of P8.8 trillion by the end of next year.

Despite jacking up its borrowings, the government had programmed the debt-to-gross domestic product at a steady 41.4 percent by the end of 2020.

The government had wanted to bring down the share of debt to the economy to 38.6 percent in 2022 by sustaining strong economic growth.

Amid flushing domestic liquidity, the government had preferred to source the bulk of its funding requirements locally in order to minimize foreign exchange risks.

In October, De Leon said 75 percent, or P1.05 trillion, of next year’s borrowings would be from domestic sources, while the remaining P350 billion would be sourced externally.

The Treasury was also looking again into offering retail treasury bonds and “premyo” bonds to small investors next year, De Leon had said.

According to De Leon, of the 2020 foreign borrowing program, $3.5 billion will be commercial borrowings through debt paper issuance, while about $3 billion will come from program and project loans to be extended by bilateral development partners and multilateral lenders.

Also, the Philippines would likely return to the Chinese, European, Japanese and US debt markets next year, according to De Leon.

Asked by the Inquirer on Thursday about the timetable for the global issuance of dollar-denominated bonds, which was usually being scheduled at the start of each year, De Leon replied: “We are still assessing funding options,” without elaborating. INQ