Small Filipino savers wanting to take a piece of President Marcos’ first retail Treasury bond (RTB) sale would earn higher interest rates than prevailing market rates.
The Bureau of the Treasury has launched on Tuesday, Aug. 23, the government’s new 5.5-year RTB, raising an initial P162.72 billion as total tenders reached P225.32 billion.
The amount raised at the the price setting auction of the peso-denominated debt was well above the P30 billion on offer.
Coupon rate for the 5.5-year retail bonds fetched 5.75 percent, higher than the 5.434 percent and 5.64 percent secondary market rates on Monday quoted by PHP Bloomberg Valuation Reference Rates published on the Philippine Dealing System’s website.
National Treasurer Rosalia V. De Leon told reporters after the auction that there was strong interest in RTB, the first issuance of such instrument under the Marcos administration.
The 5.5-year RTB will be sold until Sept. 2 with a swap offer for bonds expiring on Sept. 13, Dec. 14, Dec. 6 and Feb. 11, 2023.
Proceeds from the retail bond sale will finance the projected higher budget deficit this year.
The last time the government sold debt to retail investors was in March this year, during which it borrowed P457.8 billion of the five-year papers.
The RTB is made available for as low as P5,000 through the traditional over- the-counter placement in bank branches.
The IOUs were also sold through digital channels such as the treasury’s RTB Online Ordering Facility, the Bonds.PH mobile app, the Overseas Filipino Bank Mobile Banking App, and the Land Bank Mobile Banking App.
The issuance of retail bonds has been part of the government’s savings mobilization program designed to make government securities available to retail investors and at the same time create savings consciousness among Filipinos.
The government has been tapping funds from individuals since 2001 and had raised more than P1 trillion from the sale of the bonds with denominations as low as P5,000 in the past 21-years.