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BTr raises less than half of T-bill sales offer

THE national government on Monday borrowed P6.7 billion through the sale of Treasury Bills (T-bills), less than half of the P15 billion that the Bureau of the Treasury (BTr) intended to raise.

The Monday tender marked the third consecutive month that the Treasury was unable to fully award their intended T-bill sale.

The Treasury has been rejecting offers as investors continued to demand for rates higher than the benchmark—at some point have become “untenable” for the national government. (Related story: https://businessmirror.com.ph/2022/10/04/high-bid-rates-for-t-bills-untenable-for-treasury/)

Investors have been aggressive in their asking rates amid the hawkish stance of both the US Federal Reserve and the Philippine Central Bank.

Nonetheless, National Treasurer Rosalia V. De Leon expressed optimism that the Treasury would soon be able to make a full award of the T-bill offering.

“Hopefully we’ll be able to make [a] full award in succeeding bills auctions,” De Leon told reporters. “More and clearer information will better guide [the] market in submission of bids.”

The partial award on Monday came on the heels of full rejection made by the Treasury last week after investors sought yields higher by as much as 141.2 basis points than benchmark rates. (Related story: https://businessmirror.com.ph/2022/11/03/btr-rejects-all-bids-for-p50b-of-debt-papers/)

Monday’s auction was oversubscribed as the total amount tendered reached P21.507 billion, surpassing the P15 billion offer of the Treasury (P5 billion each of 90-day, 181-day and 362-day tenors).

The Treasury received P9.35-billion worth of bid for the 91-day T-Bill and P7.457 billion for the 182-day tenor. The auction of 364-day T-bill was slightly undersubscribed at P4.7 billion.

The average yield for the 91-day T-bill was at 4.35 percent while the 182-day tenor had an average yield of 4.8 percent. The average yield for the 364-day T-bill was 5 percent.

All the average yields were higher than the  secondary benchmark rates for the government securities based on Bloomberg Valuation: 3.856 percent (90-day), 4.55 percent (182-day) and 4.868 percent (364-day).

This month alone, the national government aims to raise P215 billion from the sale of debt papers. The amount covers P75 billion worth of T-bills and P140 billion in treasury bonds.

For the whole year, the government is set to borrow a total of P2.21 trillion, of which 75 percent will be sourced locally while the remaining 25 percent will come from foreign sources.

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