Treasury issues P25 billion worth of T-bonds

THE Bureau of the Treasury (BTr) continues to see full award of its auction of Treasury bonds (T-bonds) after it successfully borrowed P25 billion from the domestic market as rates remain well within benchmark level, according to a report by BusinessMirror.

The Treasury made a full award of its T-bonds auction on Tuesday as rates averaged at 6.378 percent, lower than the 6.463 percent secondary market benchmark rate for the same debt paper.

The reissued T-bonds, which have a remaining life of about 9 years and 6 months years, fetched rates from a low of 6.223 percent to a high of 6.410 percent, which was still below the secondary market rate.

The Treasury also noted that the average rate was also lower than the debt paper’s original coupon rate of 6.75 percent set during its first issuance last September 2022.

Tuesday’s auction was oversubscribed by 2.846 times as total tender reached P71.156 billion. This is now the ninth consecutive time that the Treasury’s auction committee decided to make a full-award of its T-bonds sale.

“With its decision, the committee raised the full program of P25 billion, bringing the total outstanding volume for the series to P140 billion,” the Treasury said through a statement it issued after the auction.

The national government aims to borrow P200 billion from the domestic debt market this month through the sale of T-bonds and bills (T-bills).

For the whole year, the national government plans to borrow P2.207 trillion with a 75:25 mix in favor of domestic sources.

In terms of domestic borrowings, the national government aims to raise a total of P1.654 trillion, P54.1 billion of which coming from the sale of T-bills while the remaining amount would come from the auction of T-bonds.