Tanzania: Investor appetite for one-year government T-bills drop

Tightness in the circulation has continued to affect one-year treasury bills trading auctioned by the Bank of Tanzania (BoT) last week resulting into under subscription.

The BoT auction summary shows that the total amount tendered increased to 120.49bn/- compared to 99.31bn/- tendered in the session held two weeks ago but it failed to breakthrough the 135bn/- offered for tendering.

With the exception of the 91 and 35 days offer that registered overly subscription, the remaining two tenors received failed to cross the line of the amount offered for tendering and was undersubscribed.

Some of the key investors in the treasury bills are commercial banks, pension funds, insurance firms and few micro finance institutions. In the 364 days tenure, a total of 65bn/- was offered for tendering but in return it received 54.85bn/-, the 182 days, a 52bn/- was offered and ended up 31.92bn/-.

For the 91 days offer, 15bn/- was offered and fetched 27.60bn/- while the 35 days a total of 3bn/- was offered to the market and fetched 6.11bn/-. Despite the undersubscription of the one year Treasury bill instrument, the government at the end retained 104.77bn/- as successful amount.

The highest and lowest bid/100 for the 364 and 182 days offers were 88.24 / 84.42 and 93.31/ 92.40 respectively while for the 91 and 35 days tenor had 97.82 / 97.21 and 99.30/ 86.54 respectively.

The weighted average interest rate on the 364 days was 15.98 per cent slightly higher compared to 14.99 per cent of the previous session held two weeks ago. 

On 182 days, interest rate rose slightly to per cent compared to 15.13 per cent compared to 14.38 per cent while the 91 days offer increased to 10.03 per cent compared to 8.95 per cent.

Interest rates and the 35 days offer it remained the same 7.35 per cent as of the previous session.
Source: dailynews.co.tzDaily News, reported from Dar es Salaam, Tanzania
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