Gov't sets retail T-bond offer Oct 9

MANILA, Philippines - The government plans to start the offer of its retail treasury bonds (RTBs) on Oct. 9, an official of a state-run bank said.

Development Bank of the Philippines (DBP) senior vice president for corporate banking sector Lilia Baun said based on the indicative offering period, the RTBs would be offered from Oct. 9 to Oct. 22, 2012.

RTBs are debt papers issued by the government for as low as P5,000. These instruments are ideal options for retail investors who want to park their funds in government debt papers.

Baun said the indicative issue date for the RTBs, on the other hand, would be on Oct. 24.

DBP, together with another government financial institution Land Bank of the Philippines (Landbank), has been designated lead arrangers for the RTB offer.

Deputy Treasurer Eduardo Mendiola earlier said the government has also directed DBP as lead arranger for a domestic bond exchange, which may be implemented in November.

Mendiola said the government hopes to sell at least P60 billion in 25-year RTBs.

Earlier, the government said it plans to exceed the P179.9-billion RTB sale in February.

On top of the RTB sale, a domestic debt exchange will also be carried out by the government as part of its debt liability management strategy. Under the plan, the government will exchange outstanding shorter-dated debt in the market with longer-dated papers.

According to Mendiola, they are looking at issuing P60 billion of each of the following tenors: 5-, 7-, 10-, 15-, 20- and 25-year T-bonds and exchange these with outstanding debt in the market.