The Bureau of the Treasury (BTr) is preparing for its euro bond issuance as it has appointed banks for the transaction and started its investor calls.
Meanwhile, the auction of treasury bills at the BTr office in Manila yesterday ended with mixed results as rates went up.
Rosalia de Leon, national treasurer, said after the auction that the government is looking at issuing three-year and nine-year tenors for its benchmark euro-denominated bond offering.
“We have announced the appointment of four banks and we started the investor calls for today so we still have to see the market conditions but we have already done the indication in terms of tenor both for three-years and nine-years,” de Leon said.
Asked why the government is preparing for a euro issuance instead of having the usual dollar-denominated bonds sale at the start of the year, de Leon said: “Obviously, you have to look at some strategy and assessing market conditions. Give and take advantage of the negative yields also on the euro area right now.”
The four appointed banks are UBS, Citibank, Standard Chartered, and Credit Suisse.
“We have done an assessment in terms of appetite. Obviously, we’ve been opening markets every year with dollar but this time we would want to approach the European investors coming from a very strong orderbook last year. There were spillovers from that that we were not able to accept. So we’re coming back for this issue,” de Leon said.
Meanwhile, the BTr made a full award for the 91-day IOUs while partially awarding the 182-day and 364-day treasury bills.
The committee raised P14.7 billion of the P20 billion offering.
The 91-day paper fetched a rate of 3.39 percent, 6.2 basis points (bps) higher versus the previous average of 3.328 percent.
Tenders amounted to P13.927 billion, more than twice oversubscribed with a full award of P6 billion.
For the 182-day securities, the rate is 3.652 percent, 6.5 bps higher versus the previous 3.587 percent.
Demand reached P8.27 billion, with a partial award of P3.02 billion versus the P6 billion offering.
Lastly, for the one-year IOUs, it fetched a rate of 3.971 percent, 7.5 bps up from the previous 3.896 percent.
The government sold P5.685 billion, lower than the P8 billion offer, with tenders reaching P11.305 billion.
