Govt issues US$5 TBs

Government has gone to the market seeking US$5 million through the issuance of Treasury bills (TBs) with a maturity yield of 90 days.

The money is meant for Government programmes including managing cash flow.

The Reserve Bank of Zimbabwe (RBZ) in a statement said that interested parties are required to submit applications for a minimum amount of US$50,000 if they are financial institutions or corporations, and a minimum amount of US$5,000 if they are individuals.

Each financial institution is allowed to submit a maximum of two bids.

“Copies of the applications are available at banks and RBZ local dealers”, the central bank said.

It said the applications should clearly mark Zimbabwe Government 90-Day USD Treasury Bills, and the interest rate for the Treasury Bills will be determined through an open tender process based on yield.

The offer for the Treasury bills will open on the 12th of October at 8:00 a.m. and close on the same day at 12:00 p.m. (noon).

Allotments, which refer to the allocation of the Treasury bills to successful bidders, will be made on the same day as the closing of the offer.

Payment for the allotted Treasury bills will be due on the following day, which is the 13th of October.

The Treasury Bill’s special features include the prescribed asset status, liquid asset status, and tradeable, allowing investors to buy or sell them on the secondary market before their maturity date.

In addition, the bills come with a tax exemption and are acceptable as collateral for overnight accommodation by the RBZ.

According to the statement, the first allotment will be based on the weighted average rate.

Treasury bills are government-issued securities used to raise funds for various government purposes and offer certain features and benefits that make them attractive to investors and institutions.

The RBZ said it reserves the right to accept or reject a portion of any tenders.

-ebusinessweekly