Treasury postpones new GS settlement system

MANILA, Philippines - The Bureau of Treasury (BTr) has postponed anew  the implementation of a non-restricted trading and settlement environment for government securities.

This marks the second time the program was deferred.  It was originally scheduled to be implemented last Nov. 21.

In a notice dated Dec. 23, National Treasurer Rosalia De Leon said the implementation of the new system has been moved to Feb. 2, 2015 instead of Jan. 5 to give concerned parties ample time to address operational concerns and other preparatory activities.

De Leon said this should allow a smooth transition to non-restricted trading and settlement environment.

The BTr is unifying the taxable and tax-exempt segment of the market by lifting the current restrictions to boost liquidity in the secondary government securities market.

Under the new system, government securities may be traded by various entities, regardless of their tax category or classification, in any securities trading market accredited by the BTr.

Securities held by government-owned and controlled corporations (GOCCs) and local government units (LGUs) may be transferred prior to maturity only with GOCCs and LGUs which maintain securities account in the book entry of the BTr.

Transfers between market participants will likewise be allowed regardless of tax status.

Tax-exempt institutions currently account for 21 percent of government securities, mostly held-to-maturity.

Finance Secretary Cesar Purisima said the lifting of trading restrictions will allow the BTr to engage, designate, or employ facilities or systems that would enhance the existing registry capabilities of the Registry of Scripless Securities (RoSS).