THE Bureau of the Treasury (BTr) on Tuesday fully awarded P20 billion in its maiden issuance of 20-year Treasury bonds (T-bonds), as investors showed stronger appetite for longer-dated securities.
National Treasurer Rosalia V. de Leon told reporters bids for the government security amounted to P50.921 billion at a coupon rate of 6.750 percent.B
“So far, so good for all the auctions for the start of the year,” de Leon said. “Now, we are also seeing the shift of appetite toward the long-end because they are trying to maximize their yields. And even inflation is expected to
trend downward.”
The strong demand for T-bonds prompted the auction committee to open its Government Securities tap facility as well as its over-the-counter (OTC) window on Tuesday.
The auction committee offered P10 billion in its tap-facility auction instead of the initial P20 billion for the 20-year T-bond.
“We can open up to P20 billion for the offer size for the auction, [but] we are just upsizing to P10 billion; we’ll see,” she added.
The Treasury’s 10 market makers are the only institutions allowed to partake in the auction under the tap facility while tax-exempt government-owned and -controlled corporations can submit their bids under the OTC window.
On Monday, the auction committee also opened its tap facility for the 364-day Treasury bills (T-bills), awarding the full P8-billion offering at an average annual rate of 5.969 percent.
Bids for the one-year T-bill amounted to P30.133 billion.
Meanwhile, de Leon also said that the government has already secured approvals for a panda bond issuance this year both from the Monetary Board and Office of the President.
“The panda bond is already on the table,” she said.