7th bumper issue of Treasury bonds goes under auction today

The seventh bumper issue of Treasury bonds with a combined value of Rs. 100 billion will go under auction today. 

CBSL has announced that Rs. 25 billion Treasury bonds under the series of 11.00%2025’A’, Rs. 25 billion Treasury bonds under the series of 11.75%2027’A’ and Rs. 50 billion Treasury bonds under the series of 11.20%2033’A’ are to be issued through an auction on 30 December. 

Apart from being the last, this is the seventh auction with a combined value of over Rs. 100 billion for 2021.

The highest for the year was Rs. 125 billion in February this year followed by Rs. 120 billion each on 13 December and 29 July, whilst the previous Rs. 100 billion worth auctions were on 11 December, 12 October and 11 January, according to data supplied by Wealth Trust Securities.

The coupon rate for Rs. 25 billion Treasury bonds under the series of 2025’A’ (issued on 1 August 2015 and maturing on 1 August 2025) is 11% per annum; the coupon rate for Rs. 25 billion Treasury bonds under the series of 2027’A’ (issued on 15 June 2017 and maturing on 15 June 2027) is 11.75%, and the rate for Rs. 50 billion Treasury bonds under the series of 2033’A’ (issued on 15 January 2018 and maturing on 15 January 2033) is 11.20%.

Bond market analysts said that despite the upward policy rate revision in August, the yields on bonds have remained at 11%. However, given the recent developments, expectations are that the bids are likely to be higher.