MANILA, Philippines — The government is eyeing to return to the panda and samurai bond markets in the next 12 to 18 months, the Department of Finance (DOF) said yesterday.
In an interview, Finance Secretary Carlos Dominguez said the government does not want to be absent from major debt market for more than 18 months.
“As I mentioned to the Treasury, I don’t want to be absent from any major market. The renminbi is the first issue we had, we probably will go back within 12 or 18 months. The same with Japan,” Dominguez said on the sidelines of the Economic Journalists Association of the Philippines Economic Forum.
The finance chief said the government learned how difficult it was to return to a market when it issued samurai bonds early this month after eight years of absence.
“We learned that it’s very difficult to get back into a market if you are absent for like eight years. We were not in the Japanese bond market for eight years and it was a little difficult. If we do one issue every year or every 18 months, it should be good for us,” he said.
In a separate interview, National Treasurer Rosalia de Leon said the issuance of renminbi and yen-denominated securities within the timeline set by Dominguez would still depend on market conditions.
“That would be a part of the financing program for next year. So we will issue, again, subject to the usual (market conditions),” she said.
De Leon said the Bureau of the Treasury (BTr) is also on the lookout for a possible euro bond issuance next year. However, she said the government is monitoring developments in Europe, particularly the tapering off of quantitative easing by the European Central Bank.
For 2019, the national government is programmed to borrow P1.19 trillion, 20 percent higher than this year’s ceiling of P986 billion.
Meanwhile, Treasury bill (T-bill) rates went up across the board during yesterday’s pilot auction using the National Registry of Scripless Securities (NRoSS).
Rates for the 91-day T-bills fetched an average rate of 3.218 percent, 1.5 basis points higher compared to the 3.203 percent recorded in the previous auction. Total tenders reached reached P8.135 billion, more than twice the P4 billion issuance.
The average rate fetched by the six-month debt papers inched up by 0.6 basis point to 4.07 percent from 4.064 percent last week. Healthy demand met the auction with total bids reaching P12.525 billion, more than twice the P5 billion offer size.
Rates for 364-day T-bills reached 4.879 percent, one basis point higher than the 4.869 percent recorded last week. Total tenders reached P15.039 percent, around 2.5 times higher than the P6 billion issue volume.
“The rates were like 0.6 to one basis point higher than the previous auction so it’s aligned with our estimates,” De Leon said when asked by the auction committee decided on a full award.