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Fifth TBs batch on the market

by Staff reporter
10 Oct 2019 at 06:43hrs | Views
THE Reserve Bank of Zimbabwe (RBZ) yesterday returned to the market with a fifth batch of treasury bills (TBs), seeking to raise ZWL$150 million to finance Government programmes.

Last week, RBZ was on the market seeking to raise ZWL$300 million for financing Government programmes via TBs offered through an auction arrangement.

In a statement yesterday, the Apex Bank indicated that the latest TBs that have a tenure of 365 days were also being sold through an auction system.

"The Reserve Bank of Zimbabwe hereby invites commercial banks, building societies, POSB and Infrastructure Development Bank of Zimbabwe (IDBZ) to subscribe to Treasury Bills amounting to ZWL$150 million," it said.

The monetary authority said applications must be for a minimum amount of ZWL$1 million with the number of bids per investor restricted to two.

The offer, which opened yesterday closes today and has special features that include a prescribed asset status, liquid asset status, tradable, tax exemption and allotment at weighted average.

TBs are negotiable debt instruments regarded as one of the safest forms of investment in the world as they are issued and backed by governments with little risk of default when it comes to payment on maturity.

In the previous political administration, TBs issuance had become a highly controversial issue as the Government raked up billions in debt through the instrument as well as a Reserve Bank overdraft facility to bridge its budget deficit.

In 2018, Treasury reverted to issuance of TBs via an auction arrangement, which was last carried out seven years ago to sanitise the issuance of the debt instrument.

Source - chronicle
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