Low asking rates prompt full award of T-bills

THE national government kicked off its February borrowing program with a full-award of P15-billion worth of Treasury bills (T-bills) as investors’ asking rates continue to fall amid stronger demand.

The Bureau of the Treasury’s (BTr) auction committee successfully raised its total intended amount after fully-awarding all the 91-day tenor, 182-day tenor and 364-day tenor of T-bills that amounted to P5 billion each.

National Treasurer Rosalia V. De Leon said the Treasury was able to fully-award the auction because of the “strong demand” and “lower rates” across all tenors.

Treasury data showed that the average rates for all the three T-bills tenors were below the secondary market benchmark levels.

The 91-day T-bills fetched an average rate of 4.152 percent, lower than its secondary market rate of 4.376 percent while the 182-day debt paper got an average rate of 4.875 percent as opposed to its 4.954 percent secondary market rate.

The 364-day T-bill, which had a secondary market rate of 5.395 percent, fetched an average rate of 5.354 percent during Monday’s auction.

Treasury data showed that all tenors of the T-bills were oversubscribed with total tender amounting to P61.85 billion, 4.123 times higher than the P15 billion programmed amount for the auction.

The 91-day T-bills had a total offer of P16.58 billion, the 182-day T-bills fetched P17 billion while the 364-day T-bills had a total tender of P28.27 billion.

Monday’s auction was already part of the national government’s domestic borrowing program.

The government seeks to borrow P200 billion in February from the domestic market through the auction of T-bills and Treasury bonds (T-bonds). (Related story: https://businessmirror.com.ph/2023/01/25/government-eyes-to-borrow-p200b-via-debt-mart/)

The Treasury has been off to a good start this year in terms of raising funds for the national government through local auctions of T-bills and T-bonds.

The Treasury has been able to achieve near full-award and full-award of government securities as investors’ asking interest rates ease within or even below secondary market benchmark levels.


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