Treasury to start selling ‘premyo’ bonds on Nov. 11

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, National Treasurer Rosalia V. de Leon said the Treasury would auction P20 billion in 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 auction was moved to Nov. 3, Tuesday, during the first week of November as Nov. 2 had been declared a special nonworking day.

The Treasury will also sell P30 billion each in three- and five-year 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 in the intermediate part of the curve.

De Leon also disclosed that the second issuance of one-year premyo bonds would be launched on Nov. 11.

The 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 would 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.