NG to issue 5-yr retail T-bonds

The government is eyeing to again issue five-year retail Treasury bonds (RTBs) to provide small investors options for their funds, Finance Undersecretary and Acting National Treasurer Roberto Tan said yesterday.

Tan said the government may issue the RTBs in July because a total of P33 billion worth of the debt paper would be maturing by then.

“We’re looking at it but more to provide supply rather than to meet revenue needs,” Tan told reporters.

Tan said with interest rates rising, RTBs may be an attractive option especially to small investors looking for facilities to park their funds.

The issuance of RTBs is part of the government’s savings mobilization program designed to make government securities available to retail investors and at the same time create savings consciousness among Filipinos.

With RTBs, investors can buy the debt paper for a minimum amount of P5,000.

Last year, the government has raised a total of P77 billion from the sale of its three-year and five-year RTBs, marking the largest fund-raising activity for the government in recent years.

The government has raised P55 billion worth of the debt paper through a public offering and some P22 billion via an over-the-counter sale to government-owned and -controlled corporations.

Officials said last year’s RTB offer was the largest. In 2003, the government was able to raise P74 billion but last year, it was P77 billion.

In 2006, the government had a disappointing issuance of RTBs when the market snubbed an offering amounting to P20 billion.

For this year, the government hopes to wipe out the deficit even as this target is at risk given the global food crisis and skyrocketing oil prices.