THE GOVERNMENT is planning to raise P240 billion from the domestic capital market in the first quarter next year, the Bureau of the Treasury (BTr) said on Friday.

The issue size is higher than the P200-billion upwardly-adjusted borrowing program this quarter and the P180 billion programmed in the first three months of 2017.

In a memorandum posted on its Web site, the Treasury said it will float P120 billion of Treasury bills (T-bills) and another P120 billion of T-bonds.

Broken down, the government will offer P20 billion from P9 billion in 91-day papers, P6 billion in 182-day notes, and P5 billion in 364-day T-bills on Jan.17 and 31, Feb. 14 and 28, Mar. 14 and 28.

Up to P20 billion worth of 10-year tenor T-bonds will be auctioned off on Jan. 11 and Mar. 22.

Also up for sale are T-bonds maturing in three, five, and seven years.

In a separate memorandum, the BTr announced the schedule for government securities auction for the January to June period even as it did not disclose yet how much it will float in the second quarter.

“The Bureau of the Treasury (BTr) released its government securities (GS) issuance program for the first half of 2018, the first time it has done so covering a 6-month period. Market participants are now guided with the auction dates and tenors of GS issuance for the said period,” the BTr said in a statement on Friday.

The switch from quarterly to semi-annual announcement of the dates and tenors of T-bill and T-bond auctions comes after the Treasury held a workshop last 25 August 2017, the statement read.

“Under the program, the BTr intends to establish liquid securities on the 3Y, 5Y, 7Y, 10Y, and 20Y tenors while maintaining weekly auctions,” it added.

“Greater transparency, enhanced predictability, and a more stable issuance program allows for a more active participation of our GSEDs in the primary and secondary market. This, in combination with the implementation of the Enhanced GSEDs Program and GS Repo Program, will allow us to achieve our objective of a deeper and more robust government securities market, thus reducing risk premium and leading to lower borrowing costs for the Republic”, National Treasurer Rosalia V. De Leon was quoted in a statement as saying.

The government has set a gross borrowing target of P888 billion for 2018, with a plan to raise $200 million from yuan-denominated bonds and $1 billion of dollar-denominated global bonds. — E. J. C. Tubayan

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