T-bill rates up across the board

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The Bureau of the Treasury (BTr) made a partial award for the one-year Treasury bill (T-bill) Monday unlike the full award for the shorter-dated securities despite an across-the-board interest rate hike among the tenors.

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Average rate of the one-year T-bill rose to 2.945 percent from 2.799 percent during the auction last March 13.
BTr offered it for P4 billion but awarded only P3.15 billion even after tenders reached P5.3 billion.

National Treasurer Rosalia de Leon told reporters after the auction that the partial award was made to make sure “that rates will stay reasonable.”

She explained that investors know that the government is very liquid following the sale of Retail Treasury Bond (RTBs) from March 28 to April 6, wherein which the government gained more than P175 billion.

“With the inflows coming from the RTBs there is really room for us to be more discerning in terms of the rates,” she said.

De Leon said the increases in the rates of the benchmark 91-day T-bill as well as the 182-day paper “are aligned with our expectations.”

Rate of the three-month paper averaged at 2.394 percent, up from 2.374 percent. BTr offered it for P6 billion and awarded it in full after bids reached P18.53 billion.

The 182-day bill fetched an average rate of 2.608 percent, higher than the previous auction’s 2.606 percent. It was offered for P5 billion and was fully awarded after total tenders amounted to P10.42 billion.

Meanwhile, de Leon said BTr officials and the banks that were tapped as selling agents are “very happy with the results of the RTB [sale],” citing that more than P500 billion worth of bids were submitted during the offer period.

She declined to say when the next RTB sale will be but noted that the government has done it annually “depending on market conditions.”

“Previously I think we do it every second quarter. It really depends on the market conditions. The marked change really is in terms of the tenor which is really on the short end,” she said.

De Leon said they remain open for other fund-raising activities for this year since “we also have to explore other opportunities not necessarily to beef up the cash buffer but also in terms of other goals in being able to diversify our investor base, in [being]able to tap opportunistic markets.”

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