Govt eyes to borrow P170B in June – BTr

THE government plans to borrow P170 billion from local sources next month, according to a program released by the Bureau of the Treasury (BTr) on Wednesday.

The planned borrowings would be down 5.55 percent from P180 billion in the same month a year ago, but match the programmed P170 billion in May.

Of the amount set, the government would generate P110 billion through the issuance of Treasury bills (T-bills) and the remaining P60 billion through Treasury bonds (T-bonds).

Of the T-bill amount, P20 billion will be raised through 91-day tenor, P20 billion through 182-day, P40 billion through 364-day and P30 billion through 35-day.

Of the T-bond figure, P30 billion will be borrowed through three-year tenor and the rest through five-year tenor.

In a Viber message, National Treasurer Rosalia de Leon explained that the bureau is offering more three-year and five-year bonds because these, and their high interest rates, are more attractive to investors. She said that the 35-day tenor was retained “to provide [an] additional liquidity layer.”

Latest data showed that government financing fell to P72.151 billion in March on the back of lower domestic and external borrowings.

During the month, domestic financing declined by 78.82 percent to P63.10 billion from P298 billion a year earlier.

Local borrowings were raised through P23.10 billion and P40 billion worth of Treasury bills and fixed-rate bonds, respectively.

Last year, issuances of government securities pushed domestic borrowings to reach P693.8 billion, 16.7 percent higher than the P594.47 billion in 2018.

Higher domestic borrowings increased national government financing to about P995 billion in 2019.

The amount, a 10.85-percent jump from P897.55 billion in 2018, was traced to the BTr’s “proactive borrowing strategy that reduced the government’s exposure to foreign exchange risks.”