91-day T-bill rate drops to 0.463%

Posted at 10/30/2012 7:23 AM

MANILA, Philippines - The government successfully sold P7.5 billion worth of 91, 182 and 364-day Treasury bills (T-bill) yesterday at rates that nearly matched historic lows.

The yield on the 91-day T-bill dropped to 0.463 percent, 24.9 basis points lower than the previous rate of 0.712 percent. The latest average rate of the benchmark T-bill is just slightly higher than the all-time low of 0.438 recorded in September last year.

Total tenders for the 91-day paper reached P5.860 billion, out of the programmed debt sale of P1 billion.

The rate of the 183-day debt paper also tumbled to 0.700 percent, 35 basis points lower than the previous rate of 1.050 percent. The government accepted P2.5 billion worth of bids out of total tenders of P9.55 billion.

Similarly, the yield on the 364-day debt paper declined to 0.950 percent from 1.35 percent previously. Total tenders reached P9.150 billion, more than double the programmed sale of P4 billion.

Outgoing National Treasurer Roberto Tan said there is a high level of liquidity in the market and strong investor appetite for government debt papers.

“Economic fundamentals and the fiscal performance continue to get stronger and even if there is an increase in the deficit level, it’s still manageable,” Tan said.

The January to September budget deficit of the government reached P106.062 billion, lower than the programmed ceiling of P183.343 billion during the period.

In September alone, the government registered a deficit of P34.854 billion.

Tan said the successful sale of retail treasury bonds (RTB) last month also improved investor appetite for government debt papers.

“We just finished the RTBs. The market is knowledgeable that we have deep cash level. The market knows we are not in a situation that we are looking for cash,” Tan said.

The government has set a new record for its RTB sale, selling P188 billion worth of the 25-year debt.

The P188 billion breached the February RTB debt sale when the government sold P179.9 billion worth of 15- and 20-year retail debt.

The government sold the 6.125-percent RTBs to individual retail investors and to government-owned or controlled corporations (GOCCs) and Local Government Units.