RBM raises K18.9 bn in T-bills
The Reserve Bank of Malawi (RBM) has for the past three weeks raised over K18.9 billion (about $47.2m) in government treasury bills (T-bills), available data indicate.
The RBM raised over K8 billion (about $20m) on September 4, about K4.9 billion (about $12.2m) the following week, about K3 billion (about $7.5m) on September 17 and K3 billion (about $7.5m) on September 24.
Commenting on the K8 billion the authorities raised on September 4, RBM spokesperson Mbane Ngwira, in a telephone interview, said the amount was purely for development of the securities market.
“The amount announced is based on an average of maturing securities which can run up to next three months. The RBM would like to encourage the development of the money market because it is another investment avenue for Malawians.
We have observed that there is a substantial demand for these securities and the RBM would like to build confidence in the market,” said Ngwira.
He, however, pointed out that the amount raised was not for the central government operations and further noted that the account for the securities is blocked and cannot be accessed by the Ministry of Finance. He also argued that the money raised was not for monetary policy purposes and is, therefore, not intended to mop up the economy of excess liquidity.
T-bills maturing in the four weeks after the September 4 auction total K3.6 billion (about $9m), according to RBM daily financial market statistics for September 5.
The report indicates that K550 million (about $1.3m) matured in the week ending September 6, about K1.8 billion will mature by end of this week, K283 million will mature in the week ending September 20 and K966 million will mature in the week ending September 27.
According to the RBM July Economic Review, total T-bills subscription in July 2013 attracted a sum of K16.37 billion (K20.35 billion face value) compared to K13.31 billion (cost values) during the previous month. The report noted that the increase in subscription was due to significant liquidity improvement which the market experienced.
