THE GOVERNMENT made a full award of the Treasury bills (T-bills) it offered on Monday as the rates mostly inched down on the back of strong liquidity in the financial system.

The Bureau of the Treasury (BTr) awarded P20 billion in T-bills as programmed yesterday as the offering was more than thrice oversubscribed, with total tenders amounting to P68.962 billion.

Broken down, the BTr borrowed P5 billion as planned via the 91-day T-bills, with tenders reaching P21.87 billion. The three-month debt fetched an average rate of 1.086%, inching down by 0.2 basis point (bp) from the 1.088% logged in the previous auction.

The Treasury likewise awarded the programmed P5 billion in 182-day debt papers as bids for the tenor amounted to P21.632 billion. The six-month papers were quoted at an average rate of 1.597%, slipping by 0.1 bp from the 1.598% seen in the previous offering.

Lastly, the government made a full P10-billion award of 364-day securities as tenders totaled P25.46 billion. The average rate of the one-year papers settled at 1.793%, unchanged from the previous auction.

The Treasury also opened its tap facility to borrow an additional P5 billion via the 364-day T-bills as the government looks to boost its coffers to fund relief measures against the coronavirus pandemic.

National Treasurer Rosalia V. de Leon said in a Viber message to reporters after Monday’s auction that yields on the T-bills were mostly steady as “liquidity remains strong” among investors.

Ms. De Leon said investors are “looking for redeployment outlets, with interest on the front end of the curve.”

A trader said investors are still waiting for stronger indicators of economic stability which could justify lower yields on government debt.

“The results were well within expectations. This is mainly due to the market putting their excess cash to work given the uncertainties surrounding the pandemic,” the trader said via Viber.

Another trader said the sideways movement of yields on the T-bills were “rollovers” from the steady demand for short-term debt papers.

Meanwhile, Ms. De Leon yesterday said the Treasury will issue Premyo bonds anew next month to raise some P3 billion in fresh funds. She said the bonds will have a tenor of one year.

“You will be after the prizes, not coupon. Tenor is only one-year so rate [will still be] better than time deposit,” she said.

Premyo bonds are part of the government’s bid to attract more small investors to invest in government securities. Last year, the BTr raised P4.961 billion from the sale of one-year peso-denominated Premyo bonds, up from its initial offer of P3 billion.

Premyo bonds are government securities that have corresponding raffle numbers for cash and non-cash prizes, aside from earning interest. The minimum investment for the bonds stands at just P500 and can be bought in multiples. One Premyo bond is equivalent to one raffle ticket.

There were 232 winners during the first Premyo bonds draw held in June this year.

Finance Secretary Carlos G. Dominguez III said in a statement yesterday that the next Premyo bond issuance will be available through the Bonds.PH app.

On Tuesday, the BTr will auction off reissued 10-year Treasury bonds (T-bonds) worth P30 billion. The debt instruments have a remaining life of four years and 10 months.

The Treasury is looking to raise P140 billion from the domestic market this month: P80 billion in weekly T-bill auctions and P60 billion in fortnightly T-bond auctions.

The government wants to borrow around P3 trillion this year from local and foreign lenders to help fund its budget deficit expected to hit 9.6% of the country’s gross domestic product. — KKTJ