- Retail Treasury Bonds #24
*Also in integral multiples of Php 5,000
**Subject to 20% final withholding tax except for tax-exempt institutions
|Issuer||Philippine Government through the Bureau of the Treasury (BTr)|
|Offer Period||July 16 to August 7, 2020 or any earlier date as determined by the BTr|
|Issue Date||August 12, 2020|
|Maturity Date||August 12, 2025|
Minimum investment of Php 5,000.
Essentially risk-free as the bond is a direct obligation of the Republic.
Higher yields than time deposits.
Simply use your existing savings or checking account as your settlement account.
Pays interest every quarter.
Can be bought and sold on any banking day, subject to prevailing market rates.
1. Visit any BPI branch during the Public Offer Period and request for the forms to invest in RTB 24. Be sure to bring a photocopy of one (1) valid government-issued I.D.
2. Fill out all the necessary details and submit the complete documentary requirements.
3. Give the cash to be invested to the branch personnel. If it will be debited from your account, please make sure that your account is funded.
RTBs are medium to long-term debt securities issued by the Republic of the Philippines (“ROP” or “the Republic”) through the Bureau of the Treasury (“BTr”). The RTBs are part of the government’s savings mobilization program designed to make government securities available to retail investors. Hence, the name Retail Treasury Bonds. RTBs are fixed-income securities that pay a fixed interest rate per annum over a specified period of time with a promise to return the principal at the end of the term.
The proceeds will be allocated to the country’s emergency, recovery, and resiliency funds. The funds serve to finance its various expenditures focused on:
1. Supporting sectors most affected by the COVID-19 pandemic (i.e., the unemployed, MSMEs, and the country’s healthcare system)
2. Construction of Infrastructure projects
3. Refinancing of existing debt
4. Other national expenditures, focused more on the country’s efforts against the pandemic
Investing in RTBs is considered safe and risk-free because they are debt instruments that are guaranteed by the Philippine government.
However, they are still affected by risk and opportunity cost. Thus, it is highly recommended that you understand it first and all the risks involved before investing in RTBs.
The BTr is issuing a 5-year RTB to provide the investing public a means to invest in a medium-term security that is a direct liability of the national government at an affordable investment amount (minimum of Php 5,000 per investor). It is also a means for the national government to raise money, with the help of the public, for its continuing efforts against the pandemic and the anticipated rehabilitation and growth to follow. Most especially, this tranche of RTBs will be focused on the much needed support of the country’s healthcare system, the unemployed, MSMEs, and infrastructure projects.
Yes, you can, but for convenience, we recommend that you invest under a single amount (in this case, Php 100,000) since the RTBs may be sold partially in the secondary market. Breaking your investments in multiple placements will require you to accomplish several sets of documents which will take additional time and effort.
Generally, the higher the risk, the higher the return. Corporations, both public and private, need to pay a higher interest rate due to the added credit and default risk. Sovereign issues, denominated in its home currency such as the RTB, are generally considered default risk-free as the government has the taxing power that will allow it to generate the funds to pay off its debt. Given that, government securities are generally priced at lower rates than corporate issuances.
For more information, visit the Bureau of Treasury’s website. You may also contact BPI Capital through the following numbers:
• (02) 8246-5166
• (02) 8246-6154
• (02) 8246-5167
• (02) 8246-5168
• (02) 8246-5170
• (02) 8246-5169