Retail T-bond sales hit record P516.3 billion

MANILA, Philippines — The government has raised a record-high P516.3 billion in funds from its three-week long sale of retail Treasury bonds (RTBs) the Bureau of the Treasury (BTr) said.

In a text message to reporters, National Treasurer Rosalia De Leon said the Treasury awarded P516.3 billion worth of five-year RTBs, P488.5 billion of which came from “new money” and P27.8 billion from switch tender offers.

The amount is more than 17 times larger than the initial target volume of P30 billion.

It is also 66 percent higher than the P310.8 billion volume issued in the previous RTB offering last February, setting a new record high for the government’s retail bond sales.

“Market liquidity, great timing and our attractive interest rate were the drivers of success for this year’s offering of RTBs,” De Leon said.

“As our economy expands and more people become financially capable to save, it is rewarding for the BTr to see a wider set of the public put their trust in our almost annual fund-raising exercise,” she said.

The debt papers, which were offered from July 16 to Aug. 7, carry a coupon rate of 2.625 percent, 362.5 basis points down from the 6.25 percent coupon recorded in the previous five-year RTB auction in February last year.

According to BTr, proceeds of the RTB issuance will be used to aid the country’s efforts to mitigate the impact of coronavirus disease 2019 (COVID-19) and to support sectors most affected by the pandemic.

The bureau said this would also be used to fund infrastructure projects and other national government expenditures.

Aside from raising new money, the auction also had a debt swap component, where holders of maturing bonds exchanged their old debt notes for the new RTBs.

To ensure the wider participation of individual investors in the RTBs, BTr opened its RTB Online Ordering Facility through its website.

BTr, in partnership with the Union Bank of the Philippines, also launched the Bonds. PH mobile application.

According to De Leon, the Bonds.PH mobile app generated nearly 25,000 downloads from 85 countries.

“Around 80 percent of more than 2,500 transactions made through the app are P10,000 and below,” she said.