P8B raised in T-bill auction

The yield on the 91-day Treasury bill rose by 9.4 basis points to an average of 1.768 percent as the government allows a further correction to bring rates closer to those prevailing in the secondary market.

Monday’s average for the benchmark T-bill was 10.7 basis points lower than the corresponding 1.875 percent set for done deals in the secondary market.

Interest rates on the 182-day T-bill rose by 1.3 basis points to an average of 2.235 percent. Rates for the 364-day T-bill jumped 32.8 basis points to an average of 2.405 percent, but the BTr did not award the entire volume.

The resulting average for the six-month bill was 25 basis points higher than the 1.975 percent rate prevailing at the Philippine Dealing and Exchange Corp. at the time of the auction. For the year-long bill, the yield was 25.5 basis points higher than the PDEx rate.

National Treasurer Roberto B. Tan said in an interview that the auction results reflected adjustments based on secondary market rates.

“We are accommodating the adjustment, but we made partial awards because we don’t want excessive increases in yield,” Tan said.

He said investors’ continued to prefer long-term debt paper.

“They’re really quite bullish of the future in terms of inflation and the fact that even the global financial markets are awash with liquidity,” Tan said.

Tenders for the 91-day bill reached P4.851 billion—less than twice the P2.5 billion offered.

Bids for the 182-day bill totaled P5.5 billion, which was also less than twice the P3 billion offered, while those for the 394-day bill reached P8.66 billion or more than twice the P3.5-billion offered.

The government raised a total of P7.9 billion instead of the planned P9 billion as buyers tendered a total of P19.011 billion.

Also, Deputy Treasurer Eduardo S. Mendiola on Monday said that the BTr would issue on February 21 a minimum of P20 billion each of 15-year and 20-year retail Treasury bonds. These will be offered to the public until February 28.

Mendiola said nine banks were given the mandate to handle the float, including First Metro Investment Corp., Metropolitan Bank & Trust Co., BDO Capital, BPI Capital, Land Bank of the Philippines, Development Bank of the Philippines, Philippine National Bank, China Banking Corp. and Deutsche Bank.