MANILA -The government generated P30 billion from a fresh issue of 15-year Treasury bonds, but resulting rates were higher than those prevailing at the secondary market.
The original carried a coupon rate of 7 percent and auction results put the average at 6.971 percent.
At the Bloomberg Valuation Service, corresponding corporate bonds were fetching 6.716 percent while similar government securities were yielding 6.75 percent.
“The auction was 1.6 times oversubscribed as total submitted bids amounted to P47.5 billion,” the Bureau of the Treasury said in a statement.
In their latest monthly report, First Metro and UA&P Capital Markets Research said they saw factors that were “pull down long bonds initially.”
These include the Bangko Sentral ng Pilipinas hitting the pause button — so far for two consecutive policy meetings in May and June — and the lowering of reserve requirements for universal and commercial banks.
BSP keeps key rate unchanged at 6.25%
With more money supply coming in due to the BSP decisions, First Metro and UA&P expect that in this second semester of 2023, yields may fall by 25 basis points as inflation loses further steam.
Meanwhile, the Marcos administration’s economic team is now in New York as they drum up interest in a planned issuance of $2 billion worth of dollar-denominated retail T-bonds in September.
Gov’t to hold marketing sortie for $2-B retail Treasury bonds issuance
National Treasurer Rosalia de Leon said last week that for this latest foreign currency RTB, the minimum investment threshold was lowered to $200 in order to attract more retail investors.
The previous US dollar RTB tranche was issued in 2021 when the government raised a total of about $1.5 billion from the exercise. Back then, the minimum amount needed to participate was $300.
The RTBs are meant mainly for Filipinos who are based abroad, but even those who are here in the Philippines may subscribe to the bonds. They may also do so using Philippine pesos, which may be converted to US dollars through the transaction process.
De Leon reiterated that this latest RTB was more about giving Filipinos an avenue to investing in fixed-income instruments and widening their investing options.
“We still have enough cash and no urgent need to raise more funds,” she said.
Gov’t raises fresh P25B from T-bonds