Domestic borrowings hit P6.41 trillion in August

MANILA, Philippines — The outstanding government securities issued by the government swelled to P6.41 trillion in August following its record-high retail Treasury bond (RTB) sale, the Bureau of the Treasury (BTr) said.

According to latest data from the BTr, the national government’s domestic debt stock as of Aug. 31 rose by 7.67 percent from the P5.96 trillion recorded at the end of July.

The bulk or 86.4 percent of this amount was raised from the issuance of Treasury bonds (T-bonds), while the remaining 13.6 percent was from Treasury bills (T-bills).

Outstanding T-bonds amounted to P5.54 trillion, 8.17 percent higher than P5.12 trillion in the previous month.

Further broken down, P2.2 trillion of the total came in the form of retail Treasury bonds (RTBs), 29.36 percent higher than the previous month’s P1.7 trillion.

The increase happened following the settlement of the government’s 24th RTB sale last August, which was able to raise a record-high of P516.3 billion.

Some P153.52 billion of the total domestic debt also came from three-year securities, while P316.78 billion was raised from five-year debt papers.

The outstanding value of seven-year and 10-year bonds also reached P594.23 billion and P593.3 billion, respectively. Twenty-year debt notes amounted to P420.33 billion.

In addition, the Treasury also reported outstanding 25-year T-bonds amounting to P235.98 billion, benchmark bonds worth P939.3 billion, onshore dollar securities worth P24.24 billion, 25-year Central Bank-Board of Liquidators bonds worth P50 billion, and premyo bonds worth P4.96 billion.

Meanwhile, BTr data showed that outstanding T-bills reached P871.47 billion as of end-August, 4.56 percent up from P833.43 billion last month.

Of this amount, P30 billion came in the form of 35-day bills, P138 billion in 91-day securities, P197.86 billion in 182-day papers, and P505.61 billion in 364-day debt notes.

The Philippine government is currently ramping up its borrowings to plug the deficit in its budget, which is expected to widen to 9.6 percent of the gross domestic product (GDP) this year due to the coronavirus disease 2019 (COVID-19) pandemic.

For 2020, the Philippines is programmed to raise P3 trillion from borrowings, bulk or P2.22 trillion of which will come from domestic sources. The remaining P785.61 billion will be sourced from external lenders.

Budget documents showed that the country’s outstanding debt is expected to hit P10.16 trillion by the end of 2020, before further increasing to P11.98 trillion in 2021.

These would translate to a debt-to-gross domestic product level of 53.9 percent for 2020 and 58.1 percent for 2021.