The Bureau of the Treasury (BTr) is eyeing to raise P150 billion next month through the regular issuance of treasury bills and treasury bonds.
This is P30 billion lower than the P180 billion programmed borrowings from the local market in September, as the BTr opted not to offer treasury bonds in the first week of October.
This is usually done when an offer period is ongoing for other government securities, which, in this case, is the retail dollar bonds (RDBs).
According to a memorandum posted by the BTr on its website yesterday, the government is programmed to raise a total of P60 billion via treasury bills and P90 billion in treasury bonds.
The BTr will offer P15 billion in treasury bills per auction next month.
The 91-day, 182-day and 364-day treasury bills will be auctioned every Monday, with volumes of P5 billion per tenor.
The BTr will also auction treasury bonds every Tuesday during the second to fourth week of October.
Tenors to be issued include five-year bonds, seven-year securities and 10-year IOUs.
The programmed volume of offering for every treasury bonds auction remains at P30 billion each.
Last Wednesday, the BTr launched the government’s second offering of its RDBs with a tenor of 5.5 years and a gross interest rate of 5.75 percent per annum that is payable every quarter until its maturity in 2029.
A total of $611.2 million was raised during the auction, which was three times oversubscribed from the initial target amount of $200 million.
The offer period for the RDBs will run from September 27 to October 6, with the issue date scheduled on October 11, 2023, subject to the discretion of the BTr.
“By offering US dollar-denominated instruments that can match natural cash flows, retail investors, especially our overseas Filipino community, are not only guaranteed a safeguard from potential FX risks but more importantly, an opportunity to maintain the value of their hard-earned US dollar savings. Furthermore, the national government is assuming the final withholding tax on interest for RDBs so that investors can enjoy the full fruits of their investment,” officer-in-charge treasurer of the Philippines Sharon Almanza said.
“Lastly, given that the RDBs are available at a minimum of $200, this product serves as a more accessible financial instrument when compared to traditional ROPs, which are available for a minimum amount of $200,000,” she added.
The Development Bank of the Philippines and Land Bank of the Philippines are the joint lead issue managers for the RDB offering, while BDO Capital & Investment Corp., BPI Capital Corp., China Bank Capital Corp., First Metro Investment Corp., PNB Capital and Investment Corp., SB Capital Investment Corp., and Union Bank of the Philippines are the joint issue managers.
