SHORT term maturities have continued to be attractive investment avenue for investors sending the government note to an oversubscription.
Commercial banks which are among the key
investors in debt instrument have increased their investment portfolio
due to increased risks in the core business lending. The 12 months
treasury bills auctioned last week attracted bids worth 289.97bn/- , up
from 169bn/- sought to be raised from the public.
Other investors in government securities
apart from commercial banks that command about 60 per cent market share
are pension funds, insurance companies, few microfinance institutions
and individuals.
Other investors in the treasury bills
auction are pension funds and some microfinance institutions. However,
apart from oversubscriptions, the government retained 165.85bn/- as
successful amount slightly below 169bn/-, the amount offered to the
market for bidding.
Central Bank uses the short-term
government note to mop excess liquidity in the circulation. Interest
rates on the 364 tenure declined to 9.65 per cent from 9.86 per cent and
10.24 per cent of the two previous sessions.
Yield rate on 182 days tenure declined
to 7.33 per cent from 7.35 per cent and 7.68 per cent of the preceding
sessions. Weighted average yield declined to 7.27 per cent from 9.28 per
cent and 9.37 per cent of the session held two weeks ago.
Weighted average price for successful
bid increased to 91.22 from 91.05 and 90.73 per cent the last sessions.
The 364 days tenure attracted bids worth 220.72bn/- compared to 100bn/-
offered to the market and at the end 133.6bn/- was retained as
successful amount.
The 182 days offer attracted bids worth
68.25bn/- compared to 65bn/- offered to the market for bidding and
31.25bn/- was kept as successful amount. The two tenures, 364 and 182
days offer commanded over 98 per cent to the total bid tendered to the
market.
The number of successful bids was 107
out of 157 that participated in the one year treasury bills auction. The
highest bid/100 and lowest bid/100 was 92.19 and 88.49 respectively
while minimum successful price/100 was 91.10 and 96.23 with weighted
average price for successful bid was 91.22.
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