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P70-B RTB sale surpasses goal

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By Philippine News Agency

The Philippine government on Tuesday (March 28) sold P70 billion worth of risk-free three-year retail treasury bonds (RTBs), more than twice the P30 billion it planned earlier, due to high demand from banks.

The debt paper attracted P86.2 billion tenders, thus, the auction committee’s decision to hike the issuance, National Treasurer Rosalia De Leon said.

Credit: Pixabay / MANILA BULLETIN

Credit: Pixabay / MANILA BULLETIN

It has a coupon rate of 4.25 percent and bid-to-cover ratio of 2.87. Issue date will be on April 11, 2017.

RTBs are intended for small investors since it can be availed for a minimum of P5,000 placement.

De Leon said the debt instrument can be availed by the public through select banks from March 28 to April 6, 2017.

“Now on its 19th issuance, the RTB has provided invaluable contributions and made the difference,” De Leon said.

De Leon explained that RTBs “has evolved as a staple platform in the Government’s financing program, allowing us to achieve (the) twin objectives of inward bias to take advantage of ample domestic liquidity and reduce foreign exchange exposure.”

“At the same time, (RTB issuance) help(s) inculcate good money habits by providing access to an affordable and secure instrument that yields favorable returns to help achieve one’s goals,” she added.

RTBs have higher yields than regular time deposits and earn a fixed interest rate based on current market rates. Its returns are given on a quarterly basis.

The Bureau of the Treasury (BTr) has tapped First Metro Investment Corporation (FMIC) and Land Bank of the Philippines (Landbank) as Joint Lead Issue Managers and BDO Capital & Investment Corporation, BPI Capital Corporation, Development Bank of the Philippines (DBP), China Bank Capital Corporation and SB Capital Corporation as Joint Issue Managers for this RTB sale.

 

The last time the government issued RTBs was in September 2016, wherein P100 billion worth of 10-year RTBS with an interest rate of 3.5 percent was sold.

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