3-year retail treasury bond for sale starting Feb. 9

MANILA, Philippines—Domestic borrowing by the government continues with the sale starting on Feb. 9 by the Bureau of Treasury of at least P30 billion worth of retail treasury bonds (RTBs) with a three-year tenor to small investors.

The RTB sale would be on top of swapping maturing debt papers.

The notice of offering, posted on the Treasury website on Friday (Feb. 5), said the offer period for the Philippine government’s 25th overall and the Duterte administration’s eighth RTB issuance since 2016 will be until March 4.

The RTBs maturing in 2024 will be sold in multiples of P5,000.

Besides selling to new investors, the Treasury will also exchange fresh RTBs for earlier-issued three-year RTBs maturing in June, 10 year-RTBs maturing in October and three other IOUs maturing in March, April and November.

Since the Treasury will hold the rate-setting auction for RTBs on Feb. 9, it cancelled its scheduled sale of three-year T-bonds on Feb. 16.

Just like previous issuances, these RTBs will be made available online via the Treasury website as well as the BONDS.PH and Overseas Filipino Bank (OFBank) apps for Filipinos working or living abroad.

Despite a pandemic-induced recession, the Treasury raised a record P516.3 billion from five-year RTBs dubbed as “progreso bonds” at a coupon rate of 2.625 percent in August 2020.

It also issued P310.8 billion in three-year RTBs at a higher 4.375-percent coupon rate in February 2020.

While promoted as a way for retail investors to grow their money through government securities, proceeds from the RTB sale would be injected into the national government budget.

For 2021, the government had programmed borrowings of P2.58 trillion from the domestic market through the sale of treasury bills and bonds, accounting for the bulk or 85 percent of the total gross borrowings expected to reach P3.03 trillion by end of the year.

TSB