MANILA, Philippines - The government plans to borrow P106.5 billion in the second quarter of the year, smaller than the programmed borrowing in the first three months of 2012, the Bureau of the Treasury (BTr) said yesterday.
In a notice, the Treasury said the government would issue P52.5 billion worth of Treasury bills and P54 billion worth of Treasury bonds from April to June or a total of P106.5 billion.
This is lower than the first quarter borrowing program of P117 billion. According to the notice, the government reduced the size of the regular T-bill auctions to P7.5 billion from P9 billion previously, with the allocations for shorter-dated tenors reduced as well.
The Treasury lowered the allocation for the 91-day T-bill to P2 billion from P2.5 billion in the first quarter while the allocation for the 182-day paper was also reduced to P2 billion from P3 billion previously.
On the other hand, the Treasury decided to maintain the allocation for the 364-day paper at P3.5 billion as investors prefer to park their funds in longer-dated securities.
In an interview earlier this week, National Treasurer Roberto Tan said that for the second quarter, the Treasury considered the government’s strong cash position.
He said the Treasury could afford to borrow less from the domestic market this year given its strong cash position which was a result of its strong retail treasury bond (RTB) sale last February.
The government sold P179.9 billion worth of RTBs - debt papers affordable to retail investors with a minimum investment of P5,000.
On the other hand, the government retained the size of the T-bond auction at P9 billion per debt sale, with tenors of 5, 7, 10 and 15 years.
The government relies on local and foreign borrowing to fund its budget deficit, which is expected to hit P286 billion this year. Last year, the budget gap hit P197.8 billion, lower than the original program of P300 billion set for 2011. - By Iris C. Gonzales