THE Reserve Bank of Zimbabwe (RBZ) said on Friday it received offers amounting to double the ZWL$60 million it sought to raise through treasury bills (TBs) it put to tender last week.
The central bank said it received bids totalling ZWL$121 million for the 365-day TBs, the second it has floated.
The bank floated the bills to raise money to finance Government operations, and the over-subscription reflected strong investor appetite for the instrument.
The target market for the TBs included banks, asset managers, insurance and pension funds and “other corporates.”
The bills had an “open tender on yield basis” interest rate, and special features, which included prescribed and liquid asset status, tax exemption and acceptability as collateral for overnight accommodation at the RBZ.
The results show that the highest rate offered was 50 percent, lowest 12 percent while the average was 14.365 percent.
Allotment of the ZWL$60 million to successful bidders, who were restricted to a maximum of two bids of ZWL$1 million each was done on Thursday.
Finance and Economic Development Minister, Mthuli Ncube has said that Government would, going forward, only issue TBs to finance its operations.
“Going forward, Government borrowings for budget purposes will observe the new TBs auction framework in order to promote transparency and the rebuilding of market confidence,” he said.
Issuance of TBs a few years ago became highly controversial as Government raked up billions in debt through the instrument as well as a central bank overdraft facility to bridge its budget deficit. — New Ziana