Gov't may sell retail T-bonds in 2nd sem

MANILA, Philippines - The government may sell retail treasury bonds (RTBs) in the second half of the year even as its cash position remains strong, Deputy Treasurer Eduardo Mendiola said yesterday.

Mendiola said that the aim is to deepen the capital market and to provide retail investors facilities where they can park their funds.

“We might issue RTBs in the second half of the year. This may be in the latter part of the year,” he told reporters.

While nothing is final yet, he said the Treasury is eyeing to issue 25-year RTBs to make it easier for the government to manage its liabilities.

He said the Office of the President has already given the Treasury the authority to issue 25-year RTBs.

Aside from retail investors, RTBs are also attracting institutional investors who want safe havens for their investments.

Mendiola said that as seen in the February RTB debt sale of 15-year and 20-year bonds, investors are already starting to feel comfortable parking their funds in long-term debt because they can sell this anytime in the secondary market.

In February, the government successfully sold P179.9 billion worth of 15- and 20-year RTBs.

The issuance of RTBs is part of the government’s savings mobilization program. The program aims to make government securities available to retail investors and to raise savings rates among Filipinos.

“It’s really part of the program so even if we have enough cash, we may still sell RTBs this year,” Mendiola said.

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

The government earlier planned to issue RTBs in two batches – one in the first half of the year and another batch in the second half – given the strong demand from retail investors.

The exact timing and volume of another RTB sale would depend on demand from market investors and if market conditions are ripe.