Treasury raises ₧283.711B on strong demand for RTBS

THE national government successfully raised P283.711 billion from its one-week long tender of 5.5-year retail treasury bonds (RTBS), according to the Bureau of the Treasury.

The amount borrowed by the national government from the domestic debt market exceeded its P30 billion target for the 29th tranche of RTBS by more than nine times.

“We capped at P250 billion but given strong demand we accepted more. It is a decision to reduce volume compared to last year. So we even closed earlier than schedule,” National Treasurer Rosalia V. De Leon told reporters after the auction on Wednesday.

De Leon noted that P31.671 billion of the total amount raised from RTB-29 came from switch tender offers.

The amount raised from RTB-29, which is the second offering under the Marcos administration, was lower by a third from RTB-28 in September 2022 that raised P420.45 billion despite having a higher coupon rate.

The coupon rate of RTB-29 settled at 6.125 percent compared to the 5.75 percent coupon rate of RTB-28.

Nonetheless, RTB-29’S coupon rate was slightly higher than the secondary market benchmark rates of 5.839 percent for 5-year tenor and 5.913 percent for 6-year tenor.

Last week, De Leon noted that RTBS have become “integral part” of the national government’s funding operations.

“Retail issuances have been a pivotal contributor to meeting our overall funding responsibilities as 38 percent of our outstanding government securities are retail instruments,” De Leon added.

The National Treasurer noted that the national government is keen on borrowing more from the domestic debt market than from abroad to protect the country from “adverse effects” of exchange rate risks.

This year the national government is eyeing to borrow a total of P2.21 trillion, about P1.65 billion of which will come from the domestic debt market.

The National Treasurer also pointed out that the BTR continues to make “strides” in bringing opportunities closer to retail investors through digitization that streamline the processes in investing in government securities like RTBS.

“RTB-29 reflects our desire to forge closer ties with our investors,” De Leon said.

“It is also an affirmation of the Treasury’s signature offering carefully strengthened for almost 22 years of arduous endeavor toward a more efficient retail market and smart choice of investment,” she added.

De Leon disclosed that the Treasury has raised P4.8 trillion throughout the 28 tranches of RTBS since its inception in 2001.