THE Philippine bond market grew at a faster pace in the third quarter on the back of higher government borrowings, the Asian Development Bank (ADB) said. 

The ADB, in its Asia Bond Monitor report released on Friday, said the local currency bond market grew 4.4% quarter on quarter to P9.76 trillion in the three months to September, faster than the 2.5% in the second quarter. 

This was also higher than the 3.4% growth seen across emerging East Asia, which includes China, Hong Kong, Indonesia, Korea, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. 

The quarterly rise “was driven solely by the government segment as the corporate segment contracted during 

the quarter,” the ADB said. 

Year on year, the peso bond market grew 20%. 

Government bonds amounted to P8.32 trillion at the end of the third quarter, up 6.2% quarterly and 28% year on year. 

Broken down, outstanding Treasury bills declined 7.9% to P943 billion compared to the second quarter, but went up 7.5% from a year earlier. 

Meanwhile, Treasury bonds increased 8.3% quarterly to P6.88 trillion, which was also 24.3% higher from a year ago. 

“Bureau of the Treasury (BTr) increased the offer volume for Treasury bonds during the quarter as it wanted to extend its debt maturity profile to take advantage of favorable interest rates,” ADB said. 

“Despite having one auction with partial awards and one unsuccessful auction, the resulting total debt sales in Q3 2021 were still up significantly from the previous quarter as the BTr opened its tap facility on several occasions.” 

Central bank securities rose by 10% quarter on quarter to P440 billion, surging 780% from a year earlier. 

Corporate bonds declined 5.1% quarter on quarter to P1.44 trillion. This was also 11.9% lower than the same quarter last year. — Jenina P. Ibañez