Treasury to start selling ‘premyo bonds’ on Nov. 11
MANILA, Philippines — The Bureau of the Treasury plans to raise P140 billion from its weekly auction of government securities in November on top of launching the second premyo bonds offering where investors can also win prizes.
In an Oct. 27 memorandum to government securities eligible dealers (GSEDs), National Treasurer Rosalia V. de Leon said the Treasury will auction off P20 billion in T-bills — P5 billion in the benchmark 91-day, P5 billion in 182-day, and P10 billion in 364-day — on Nov. 3, 9, 16 and 23.
The usual Monday T-bills auction was moved to Nov. 3, Tuesday during the first week of November as Nov. 2 had been declared a special non-working day.
The Treasury will also sell P30 billion each in three- and five-year T-bonds on Nov. 4 and 17, with the usual Tuesday bond auction also moved a day later as a result of the Nov. 2 holiday.
De Leon said the bond tenors were based on recent auction results wherein the investors’ sweet spot was on the intermediate part of the curve.
De Leon also disclosed that the second issuance of one-year premyo bonds will be launched on Nov. 11.
The premyo bonds, to be offered in denominations of only P500, will be a “safe investment in nation-building with higher prizes,” de Leon said.
The Treasury plans to raise at least P3 billion from these IOUs, which will give retail bondholders not only an affordable investment but also a chance to win prizes such as cash, house-and-lots or condominium units, and cars.
De Leon said the Treasury will launch a new mobile app in time for the premyo bonds sale.
The government had programmed to borrow a record P3 trillion — P2.22 trillion from local sources on top of P785.6 billion in external borrowings — in 2020 to finance the protracted fight against the health and socioeconomic crises inflicted by the COVID-19 pandemic.
With the fresh P540-billion repo agreement with the Bangko Sentral ng Pilipinas in place, domestic borrowings will suffice in the meantime such that the Philippines shelved the issuance of yuan-denominated panda and yen-denominated samurai bonds this year.
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