The Philippines Government sold off P9.8 billion worth of Treasury bills (T-bills) as investments were dumped in favour of stable safe haven positions. Which the current state of the stock market people are looking for alternative investments as a current high level of liquidity exists in the financial sector.Coming from a 63.64-point loss on Friday, the benchmark 30-company Philippine Stock Exchange index shed 48.79 points or 1.12 percent to close at 4,291.11 Monday. A slide in the market is causing some concerns.
Foreign investors generally cannot get into SDA’s (Special Depository Accounts) but what happened is they were pulled of of local bourse and poured into government securities instead. The SDA’s are short term investments used by Bangko Sentral ng Pilipinas to siphon off excess liquidity in the market.
Price wise the Philippines treasury bills fetched a value of only 0.979 percent, lower than the previous average of 2.073 (109.4 basis point decline). Over a six month period the price has also shown lower 1 percent rate from its 2.250 rate previously.
Tenders for the 91 day papers reached P14.686 Billion, which caused the government to raise the sale by P800 million from the original P2 Billion. The 182 day Treasury bills produced tenders of P13.7 Billion which is four times larger than the original offer of P3 Billion originally programmed for sale.
The 1 year paper though seen an average rate of 1.5 % showing a trend in the market and its lowest in 24 years down 125 base points. Total tenders for this reached P14.685 Billion with the government offloading P4 billion.These auctions are part of the Philippines governments third quarter borrowing program fixed at P117 Billion with P54 Billion being treasury bills and P63 Billion being Treasury Bonds.