PHL closes retail bond offer period early on strong demand

Stronger-than-expected demand forced the Bureau of Treasury to end by Wednesday, Feb. 23, the offer period for retail Treasury bonds (RTBs).   The offer period was closed a week earlier than the Feb. 29 closing date by capping the total float of 15- and 20-year RTBs at P150 billion to P180 billion, said Deputy Treasurer Eduardo Mendiola.   The value reflects a record sale for RTBs, according to the Treasury officials.   However, only the 20-year RTBs will be closed as of Wednesday.   “We have decided to cut the offer period,” Mendiola said, noting that the demand already exceeded expectations.   As of Feb. 22, government already sold P106.73 billion worth of RTBs, P25.78-billion of the 15-year debt paper and P80.95 billion of the 20-year debt.   During Monday’s price-setting auction, the Philippines was able to fetch a 5.375-percent coupon rate for the 15-year RTBs or similar to secondary market rates for such debt papers but lower than the 6.25 percent of last October’s issue.   For the 20-year RTBs, government set the coupon rate at 5.875 percent — reflecting a premium over the 5.35 percent secondary market rate.   The strong demand reflects the makings of a new record for Philippine RTBs, and compares with the P114.4-billion raised in 2009, according to one of the issue managers hired for this issue.   “We are looking at setting a new high here,” said First Metro Investment Corp. (FMIC) president Juanchito Dispo. — VS, GMA News