T-bill rates rise on Taal jitters

Treasury bill rates on Monday rose across the board as the market went jittery due to last week’s eruption of Taal Volcano.As a result, the Bureau of the Treasury sold only P14.71 billion out of the P20-billion offering of short-dated securities as it capped the rates for the 182- and 364-day debt paper despite tenders that totaled P33.5 billion across the three tenors, making the auction over 1.5 times oversubscribed.

The Treasury awarded all P6 billion in the benchmark 91-day T-bill at 3.39 percent (up from 3.328 percent last week); P3.02 billion in 182-day at 3.652 percent (up from 3.587 percent) out of P6-billion offering; and P5.69 billion in 364-day at 3.971 percent (up from 3.896 percent) out of the P8-billion offer.

Meanwhile, instead of embarking on a dollar-denominated global bond sale at the start of the year, National Treasurer Rosalia de Leon said the Philippines started investor calls for the issuance of benchmark-sized euro-denominated bonds or at least 500 million euros’ worth also on Monday.

“We’ve been opening markets every year with dollar bonds, but this time we would want to approach European investors coming from a very strong order book last year—there were spillovers we’re not able to accept. So we’re coming back for this issue,” De Leon explained.In May last year, the Philippines returned to the euro debt market to end the country’s 13-year absence, selling 750 million euros in eight-year bonds at a coupon of 0.875 percent. —Ben O. de Vera INQ