Treasury sells P463-B in retail bonds

Published March 4, 2021, 4:59 PM

by Chino S. Leyco

The Duterte Administration has raised P463.3 billion from the latest offering of retail bonds targeted at local small investors, the Bureau of the Treasury announced on Thursday, March 4.

National Treasurer Rosalia de Leon said that P411.8 billion of the total proceeds will be used for the government’s budgetary purposes while the remaining P51.5 billion were earmarked to swap current securities with the new retail bonds.

De Leon said the successful offering of the new three-year retail treasury bonds (RTBs) demonstrated increasing awareness of retail investors on government securities as a safe investment option.

National Treasurer Rosalia De Leon

“[It is a] convenient investment particularly with easy access with mobile applications. More so, [it is a] way of contributing to a strong and inclusive economic rebound,” de Leon told reporters in a mobile phone message.

The latest RTBs—the government’s first issuance this year—were offered to the general investing public in minimum denominations of P5,000. 

Last Feb. 9, the treasury sold an initial P221.22 billion in three-year retail bonds at a coupon rate of 2.375 percent. The target settlement date is on March 9.

Proceeds from retail bond issuance will be allocated to government efforts in helping the country mitigate the impact of the coronavirus pandemic and support the sectors most affected by the ongoing pandemic.

Aside from fresh investments, participants of this RTB tranche also got the opportunity to swap their old bonds maturing this year for the new debt papers.

Eligible bonds for the debt swap offer included fixed rate treasury note (FXTN) 07-57 maturing on March 20, FXTN 10-53 maturing on April 28, RTB 03-09 maturing on June 13, RTB 10-03 maturing on October 20, and FXTN 10-55 maturing on November 24.

This retail bond offer will be the eight of its kind made during the Duterte administration.

The first was in September 2016; the second and third in April and November 2017, respectively; the fourth in May 2018; the fifth in February 2019; the sixth and seventh in January and August 2020.