Rosalia de Leon
The government raised a total of P45 billion from an original issue of 3.5-year treasury bonds, which carried a coupon of 5.25 percent but fetched an average yield of 5.153 percent.
The Bureau of the Treasury-led auction committee decided to fully award its offer of P35 billion through a regulator auction and an additional P10 billion through a tap facility.
The committee decided to raise more funds through pro-rata purchases of those who were awarded the government securities in the regular auction.
At the auction, investors tendered at total of P106.3 billion, which was more than thrice the volume offered.
Through the tap facility, investors also made available P117.03 billion or almost 12 times the P10-billion offer.
National Treasurer Rosalia de Leon described the results as “impressive,” noting the strong demand.
Such demand was “coupled with the coupon rate being lower than comparable rates in the secondary market,” De Leon said.
It also helped that there were P37 billion worth of securities that The Treasury redeemed, proceeds from which “found a home in today’s offering,” she added.
The BTr first adopted the tap facility—an electronic system that improves the issuance of government debt instruments—in 2009.
The system allows government securities eligible dealers (GSEDs) to electronically bid for additional offerings after a successful auction.
Through such electronic means, the awarding process and the generation of reports will be automated to ease the process of issuing additional securities.
The tap facility is a sub-component of the BTr’s automated debt auction processing system, which is an electronic mode by which the national government sells government securities to a network of GSEDs.
Implementation of the tap facility was aimed at enhancing the government’s efficiency in issuing more debt papers, and was expected to help promote the growth and the competitiveness of the country’s capital market. INQ