Investors gobble up retail T-bond issue

MANILA, Philippines — The government managed to borrow an initial P212.7 billion in the third offering of retail Treasury bonds (RTBs) under the Marcos administration in a bid to expand state coffers and finance various projects.

The Bureau of the Treasury on Tuesday launched RTB-30, a five-year bond designed for retail investors as a low-risk and higher-yielding savings instrument.

Total tenders reached P272.708 billion, well above the P30 billion target offer.

Coupon rate fetched at 6.25 percent, higher than the average rate of 6.156 percent.

During the launch, National Treasurer Sharon Almanza said the government marked another high point in the 23 years of RTB history.

“It is the first of many. This is our first RTB issuance under Secretary (Ralph) Recto, our first funding exercise for the year outside of our regular securities, and our first in-person launch after the pandemic,” Almanza said.

“Our offerings have been met with blockbuster demand, which is a statement of the government’s strong macro fundamentals and toward continuing the pursuit of bigger financial literacy and inclusion among Filipinos,” she said.

Recto, for his part, emphasized that RTBs remain to be a safe, affordable and accessible investment opportunity for Filipinos.

The finance chief stressed the need to install the culture of saving among Filipinos while actively participating in nation development.

“This empowers our people to effortlessly secure their future and foster a mindset that prioritizes social dividends as investments should contribute to the collective welfare of the community,” Recto said.

Proceeds of the issuance are usually allocated to boost the country’s agriculture sector, infrastructure, education and healthcare systems, among others.

Since 2001, the government has raised P5.1 trillion from 29 tranches of RTBs to support financial inclusion and literacy among Filipinos by making government securities more accessible to small investors.

This is equivalent to about a third of government securities.

The Treasury will sell the RTBs, for as low as P5,000, from Feb. 13 to 23 or any earlier date within the offer period as determined by the Treasury. Bond settlement is scheduled on Feb.28.

There is also a swap offer for bonds expiring on March 9 and March 12 this year.

This is the third RTB issuance since the Marcos administration assumed office in July 2022.

The maiden issuance in September 2022 raised a total of P420.25 billion with a coupon rate of 5.75 percent, followed by a second offering in February 2023 that managed to secure a lower amount of P283.71 billion and a higher rate of 6.125 percent.