The 10-year bond by the Bank of Tanzania (BoT) was
oversubscribed by 19.49bn/-, an equivalent of 65 per cent.
According to the results of the tender floated last week,
despite the oversubscription, the central bank accepted only 30bn/- sought to
be mobilised after bidders demanded for high prices.
“The highest and
lowest bids were valued at 84.10 and 70.06, respectively while the average
price for successful bids was 81.56,” stated the report.
In the 10-year tender, only 24 out of 31 bids received
emerged successful, an indication that some investors tendered below the price
offered at the market.
In the preceding auction deal, the government accepted more
funds and concentrated on bond issuance to finance its development
expenditures.
In the meantime, interest rates was 15.06 per cent lower
than the rates offered in the previous 10-year deal, it did not prevent
investors from injecting massive funds.
Furthermore according to the central bank’s monthly economic
review for the year ending June 2012, auctioned Treasury bonds worth 30bn/- and
15bn/- of 2-year and 10-year maturities, respectively.
The auctions were oversubscribed and dominated by commercial
banks, pension funds, insurance and few micro-finance institutions firms which
are among the key players in the long term fixed instruments.
The BoT accepted bids amounting to 20bn/- and 15bn/ for the
2-year and 10-year Treasury bond, respectively. The weighted average yields for
the treasury bonds increased when compared to the rates recorded in the
preceding auctions.
Source: The Daily News,http://www.dailynews.co.tz, reported by Sebastian Mrindoko
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