Treasury makes full award of P15 B reissued T-bonds

By Mary Grace Padin (The Philippine Star) Updated February 8, 2017 – 12:00am http://www.philstar.com/business/2017/02/08/1669999/treasury-makes-full-award-p15-b-reissued-t-bonds MANILA, Philippines – The Bureau of Treasury (BTr) yesterday made a full award of reissued Treasury bonds with remaining life of two years and 11 months amid strong participation from the market. The reissued papers fetched an average rate of 3.492 percent, 12.8 basis points higher than the 3.364 percent yielded in the previous auction dated Jan. 10. This is also broadly aligned with secondary market rates of 3.4458 posted before the auction closed. Tenders amounted to P33.98 billion, more than twice the P15 billion offer. Newly reappointed National Treasurer Rosalia de Leon said the auction results showed the domestic finances’ resilience in the face of global headwinds. “I am pleased with the results of the auction, we see the very healthy participation from our GSEDs (government securities eligible dealers), but obviously also they are already priced in about expectations that it is already in the papers,” De Leon told reporters. “I hope that this continued strong participation from the market would be there during the succeeding auctions of the Treasury,” she added. A local bond trader told The STAR domestic and external factors continue to influence the auction rates. “The concerns remain the same. We are still expecting supplies on the short dates given that the BTr has scheduled for the first three months of the year to issue mostly short dates in three and five year tenor. It’s called supply risk,” she said. The trader said the normalization of domestic inflation, which increased to 2.7 percent in January, as well as developments abroad, also post risks to the market. According to the trader, market players are keen to hear the Bangko Sentral ng Pilipinas’ statements on inflation moving forward during this week’s Monetary Board meeting. Meanwhile, De Leon said the BTr would continue to implement projects, such as the new registry of scripless securities (nRoSS) and reforms in repurchase agreements (repo) under her term. “For the RoSS, I think we have done good progress on that since we started two years ago and we have a timeline. We are now in the process of validating the outcomes and eventually doing some test runs, as well,” she said, adding that test runs would commence in the second quarter of the year.