91-day Treasury bills swamped

MANILA, Philippines — The Bureau of the Treasury (BTr) awarded in full yesterday the 91-day Treasury bills (T-bills), but made a partial award of the 182- and 364-day securities as the market continued to show preference for short-term debt papers.

During yesterday’s auction, the BTr sold P5 billion worth of 91-day T-bills at an average rate of 3.597 percent, 10.4 basis points higher than the 3.493 percent recorded in the previous auction.

The securities were more than twice oversubscribed with tenders amounting to P10.91 billion.

On the other hand, the auction committee only accepted P3.485 billion in tenders for six month T-bills after it capped the rates.

Despite this, the average rate for the papers still rose by 20.5 basis points to 3.889 percent compared to the previous rate of 3.684 percent.

Total tenders for the 182-day securities reached P4.085 billion.

The Treasury also awarded P1.63 billion worth of 364-day T-bills at an average rate of 3.986 percent, 15.6 basis points higher than the 3.83 percent recorded in the previous auction.

Underwhelming demand met the auction, with total tenders amounting only to P2.88 billion, as compared to the P6 billion original volume.

National Treasurer Rosalia de Leon said results of the auction reflect the market’s continued preference for the short end of the curve.

However, De Leon noted the increase in the rates during the auction was tempered down following the BTr’s announcement on the fiscal position of the government in the first quarter.

“We announced the very good collections of the BIR and BOC and the lower-than-programmed deficit. So we see that for the part of the Treasury, we are very much still in a strong liquidity position,” she said.

Meanwhile, De Leon said the government continues to look into other fund raising activities to diversify its sources of financing.

“And also the secretary has mentioned we are exploring also the Samurai (bond) market and also possibly looking at other structures, including the Sukuk, so we’re not confined alone on the onshore,” the official said.