Gov’t finally accepts higher bids for P 20-B T-bills

After two weeks of rejecting investors’ high bid rates, the Bureau of the Treasury on Monday finally sold P20 billion worth of bills.

National Treasurer Rosalia V. de Leon said that rates were already “within internal estimates and secondary levels” even as they rose compared with previously awarded auctions.

“The market continues to remain cautious as the duration of the lockdown is uncertain. But at the same time, [investors] have to deploy liquidity from the RRR cut,” De Leon said, referring to the reduction in banks’ reserve requirement ratio approved by the Bangko Sentral ng Pilipinas to help boost economic activity.

The 200-basis points (bps) cut in bank reserves took effect last March 30, releasing about P225 billion into the financial system.

For the benchmark 91-day bills, P10 billion were sold at an average rate of 3.413 percent.

Also, P5 billion each in 182- and 364-day debt paper were awarded at 3.553 percent and 3.845 percent, respectively.

The three-month IOUs were previously issued at 3.024 percent a month ago; six-month debt, 3.398 percent three weeks ago, and one-year government securities, 3.557 percent also three weeks ago.

Across the three tenors, tenders totaled P37.68 billion, making the auction almost twice oversubscribed. —Ben O. de Vera INQ