by Joann Villanueva/PNA
All Philippine government-issued Treasury bill (T-bill) tenors were oversubscribed on Monday even while rates ended mixed.
Bureau of the Treasury (BTr) offered the bellwether 91-day paper for PHP4-billion and the auction committee made a full award after average rate went down to 5.635 percent from 5.787 percent during the auction last March 25. Tenders reached PHP8.808 billion.
Rate of the 364-day T-bill also declined to 5.961 percent from 6.044 percent in the previous auction.
This was offered for PHP6 billion and investors submitted a total of PHP10.161-billion worth of bids. The auction committee made a full award.
On the other hand, rate of the 182-day securities rose to 5.958 percent from 5.927 percent in the previous auction.
Tenders amounted to PHP6.772 billion, higher than the PHP5-billion offer. This was also fully awarded.
National Treasurer Rosalia de Leon noted the high demand for the longer-tenor securities, which she attributed to expectations of a sustained slowdown in domestic inflation.
After peaking at 6.7 percent in September and October, rate of price increases eased to 3.8 percent last February.
Average inflation in the first two months this year is still above the government’s 2 to 4 percent target but monetary officials expect continued deceleration on monthly levels. Full-year average is projected at three percent.
De Leon also cited the lower offering this week compared to the previous week.
Last week, three and six-month papers were offered for PHP6 billion while the one-year securities were offered for PHP8 billion.
De Leon attributed this to the revised programmed issuance for the second quarter this year given the healthy auction results in the first quarter of the year.
Meanwhile, the National Treasurer, who joined the Philippine Economic Briefing in Beijing, China and the non-deal roadshows in several other areas in that country, said the roadshow “went very well.”
“We saw the strong interest in the Philippines not only for the fixed income because of our issuance in the onshore renminbi market but more so because of investing in the Philippines (in general),” she said.
“They (the Chinese investors) have expressed their interest to participate in the forthcoming onshore Panda issuance,” she said.
The Philippine government is gunning for a second issuance of the renminbi-denominated Panda bond after the success of its initial foray in March 2018.
Last year, the Philippine government issued RMB1.46-billion worth of three-year Panda bond, debt paper that is issued by a non-Chinese issuer in China.
The issuance is part of the government’s diversification of its securities holdings.
De Leon said they are considering to issue about USD500 million worth of either three- or five-year Panda bond possibly within this quarter but stressed that this will depend on investors’ appetite
Also in the pipeline is the issuance of the yen-denominated Samurai bond after the issuance of the multi-tranche of the same securities in August 2018 amounting to 154.2-billion yen.
De Leon said this might not be done this quarter because “we have to calibrate also our borrowings in terms of the spending.”
Earlier, BTr officials said they are considering to issuing both the Panda bond and Samurai bond 12 months after the exercise last year.
