T-bills fetch higher rates

by Mary Grace Padin (The Philippine Star), 22 Sep 2020

MANILA, Philippines — The Bureau of the Treasury (BTr) made a full award of the P20 billion worth of Treasury bills (T-bills) auctioned yesterday even as rates moved up across-the-board.

During yesterday’s auction, the BTr accepted P5 billion in bids for the 91-day securities. The yield for the 91-day paper inched up by 0.6 basis point to 1.156 percent from 1.15 percent last week.

The offering was more than five times oversubscribed, with total tenders amounting to P26.931 billion.

Rates for the 182-day debt papers also gained by 2.6 basis points to close at 1.615 percent from 1.589 percent a week ago.

Despite the uptick, the auction committee decided to fully award the P5 billion offering. Healthy demand met the auction, with P14 billion in total bids.

Lastly, the 364-day debt paper fetched an average rate of 1.85 percent, 4.3 basis points higher than the 1.807 percent last week.

The P10 billion offering was similarly awarded in full despite the increase in rates, while total tenders amounted to P31.96 billion.

Overall, yesterday’s auction attracted P72.9 billion in total tenders, P20 billion of which was accepted.

In a text message to reporters, National Treasurer Rosalia de Leon said rates increased amid expectations that the Bangko Sentral ng Pilipinas (BSP) would “keep policy rates steady for the remainder of the year.”

Nevertheless, she said demand remained strong as all tenor buckets saw an oversubscription.

Meanwhile, de Leon hinted that the BTr’s second prize or “premyo” bond offering would be “bigger” than the first tranche.

“Watch out for second premyo (bond issuance). (It will be) bigger, more exciting,” she said.

She said the issuance would be launched earlier than December.

On the other hand, the BTr chief said the third quarter raffle draw under the first premyo bond tranche will be conducted on Friday.

During the previous premyo bond offering of the government, the BTr successfully sold P4.961 billion worth of one-year debt papers to small investors.