MANILA — The Bangko Sentral ng Pilipinas (BSP) cut the offering for the seven and 28-day Term Deposit Facilities (TDF) in its auction on October 31, 2018.
The offering for the seven-day facility was cut to PHP40 billion from PHP50 billion this week and the 28-day facility to PHP10 billion from PHP20 billion.
Data released by the central bank Wednesday showed that banks submitted a total of PHP53.642 billion worth of bids for the shortest tenor facility, higher than the PHP50 billion offering but lower than the PHP66.002 billion bids last week.
This resulted in the drop of the facility’s bid coverage ratio to 1.0728 from 1.3200 last week.
Its weighted average accepted yield also declined after ending the auction at 4.7196 percent from 4.7207 percent last week.
Also, the longest-tenor facility received PHP18.665 billion worth of bids during the auction this week, lower than the PHP20 billion offering.
The auction committee accepted all bids for the facility.
With the lower-than-offered tenders, bid coverage ratio of the facility declined to 0.9333 from 2.1805 during the auction last week.
On the other hand, the facility’s average rate rose to 4.8493 percent from 4.8362 percent in the previous week.
Offering for the 14-day facility was kept at PHP20 billion for next week.
This week, this tenor received PHP28.506 billion-worth of bids, lower than the PHP31.273 billion tenders during the auction last October 17.
This resulted to the drop-in bid coverage ratio to 1.4253 from 1.5637 last week.
The facility’s average rate also fell to 4.7553 percent from 4.7650 percent in the previous auction.
Monetary officials said the change in the offering for the TDFs are based on their outlook for liquidity.
In the past, TDF offerings have been reduced during auctions that fall close to holidays, in anticipation of banks’ heightened liquidity requirements.
Next week will be a short trading week, as the Philippines commemorates the All Saints Day and All Souls Day holidays. ( Joann Villanueva/PNA)
