The Philippines' Bureau of the Treasury said on Friday it would begin an offer of 2021 retail treasury bonds on May 30. The launch of a minimum 30 billion pesos ($570.6 million) worth of 3-year retail bonds would come two days before the central bank's 1 percentage point cut in the reserve requirement ratio (RRR) comes into effect. The retail bonds will be sold to the public and state-run firms from May 30 to June 8, the Bureau of the Treasury said in a notice on its website. Pricing will be set at an auction on May 30 and issuance is on June 13.
On Thursday, the Bangko Sentral ng Pilipinas announced a second cut in banks' reserve requirement in three months that would bring the RRR level - still one of the highest in Asia - to 18 percent. The 1 percentage point RRR cut is expected to add around 100 billion pesos to the financial system after it takes effect on June 1.
The retail bond offering could help siphon off additional liquidity, which analysts have said, could add more pressure on the peso which hit a fresh 12-year low on Friday. The government last issued a retail treasury bond in November, raising 255.4 billion pesos from the five-year debt.
Proceeds from the new retail treasury bond will help raise funds for the government's aggressive spending to build and modernise roads, bridges, railways, seaports and airports under its flagship $180 billion "Build, Build, Build" programme.
Comments
Comments are closed.