go through Aaron Michael C. Sy reporter
The government proposed The initial P135 billionNew 10 years fixedThe evaluation of the treasury pointed out Auction Tuesday New issuance format for institutional investors.
The Treasury Agency (BTR) said in a statement after the auction that the amount raised was more than four times the original P3 billion Phil (P3 billion P197.3 billion).
The rate auction results released on the Ministry of Finance’s website show that the new Treasury bills (T-Bonds) have a coupon rate of 6.375%, and its average interest rate is 6.286%.
The bids accepted yields range from 6% to 6.4%.
The coupon rate is 10.37 basis points (BPS), which is 6.2713% of the 10-year notes published on the Philippine Trading System website as of April 15.
BTR will continue to provide notes to qualified dealers until April 24 with a minimum investment of 10 million pesos, with an increase of 1 million P1 thereafter.
The issuance date for the 2035 mature notes is scheduled for April 28.
“The extended quotation period will be larger than our regular auctions. So it will ensure liquidity,” Sharon P. Almanza, national treasurer, said in a Viber message.
The Treasury said the extended offer period was the first in the issuance of non-retail bonds as it “tryed to establish new avenues to build liquid benchmarks.”
“Demand is strong. Investors are looking for [buy] Since inflation is low, this may lead to higher tax reductions, so buying interest rates is good. ” a trader said over the phone.
The trader added that the level of coupon rate similar to that of the secondary market interest rate is market expectations.
The Monetary Commission resumed its easing cycle last week, reducing its target reverse buyback rate by 25 basis points to 5.5%. Interest rates for overnight deposit and loan facilities also fell to 5% and 6% respectively.
Eli M. Remolona, Governor of Sentral Ng Pilipinas, Little Bangkok. It said the expectation of easing inflation supports a shift to a looser monetary policy stance, adding that they are considering a further reduction in the “baby steps” at a time with 25 BPS.
Michael L., chief economist at Rizal Commercial Banking Corp.
Another trader said in a text message: “I think that volume is good for BTR because it provides them with a mat. We think it's close to their target amount. This puts less stress on shorter tenors, especially for five years and under.”
Traders added that BTR could be raised to P200 billion from this product to bring the maturity rate this month to about P170 billion, and ahead of the huge maturity in August.
The Philippine Development Bank (DBP) and Landbank are co-issued business managers, with BDO Capital & Investment Corp., BPI Capital Corp., Bank of China Capital Corp., First Metropolitan Investment Corp., PNB Capital and Investment Corp., and Security Bank Investment Corp. as co-issued business managers.
Qualified dealers of new bonds include Bank of Asia, BDO Capital and Investment Corp., BDO Unibank, Inc. , BPI Capital Corp., Bank of China Banking Corp., Citibank NA, CTBC Bank (Philippines) Corp., DBP, DBP, DEUTSCHE BANK AG, DEUTSCHE BANK AG, East West Banking Corp., National Bank of Philippines, Rizal Commercial Banking Corp., Standard Chartered Bank, Security Bank Corp., Landbank and United Bank of Philippines, National Bank of Philippines and United Bank of Philippines, Metropolitan Bank & Trust Co.
The Treasury hopes to raise 245 billion pesos from the domestic market this month – through T-bills and 120 billion Philippine pesos through T-bonds.
The government borrowed funds from local and foreign countries to fund its budget deficit, which is P15.4 trillion this year.
