T bills oversubscribed

DAILY NEWS Reporter

HIGH appetite greeted one year treasury bills auction held on Wednesday despite fulfilment of end of month obligations by institutions and corporate next week.

Similarly, the high demand for the treasury bills is translated into high liquidity in the circulation that pushed the short term maturities into four times subscriptions.

According to the Bank of Tanzania (BoT), auction results, a total of 133bn/- was offered to the market for bidding and in the end it attracted bids worth 386.21bn/-, although the government retained 179.52bn/-as successful amount.

Yield rates across all tenures declined at weighted average of 16.81 per cent compared to 17.96 per cent of the previous treasury bills session held two weeks ago. Likewise out of 328 number of bids received during the trading session, only 93 emerged to be successful.

Some of the investors in the one year treasury bills are namely commercial banks, pension funds, insurance companies and some micro-finance institutions. The two tenures, 364 and 182 days have continued to dominate and most attractive after contributing over 90 per cent of the total bids while 91 and 35 shared the remaining.

The 364 and 182 days offer attracted bids worth 253.69.8bn/- and 122.31bn/- respectively against 75bn/- and 50bn/- offered to the market for bidding while the 91 days offer attracted 10bn/-.

Yield rates for the 364 and 182 days offer were 17.32 per cent and 16.76 per cent respectively compared to 18.34 per cent and 17.40 per cent of the previous session held two weeks ago.

The 91 days tenure interest rate was 8.24 per cent compared to 8.94 per cent. The highest and lowest bid/100 for the 364 and 182 days offers were 85.87/83.30 and 92.65/90.08 respectively while for the 91 was 98.04/97.82.

The minimum successful price/100 for the 364, 182, 91 and 35 days offer were 84.86, 92.19, 97.85 and 100 respectively.