Dhaka, Bangladesh (BBN) - The interest rate on Bangladesh Government Treasury Bonds (BGTB) increased slightly Tuesday, as primary dealers are not interested in buying the bonds with a lower interest rate, treasury officials said.
The yield, generally known as coupon interest rate, on 15-Year BGTB rose to 9.3000 per cent on the day from 9.2000 per cent of the previous auction, held on March 8 this year.
"The yield of the BGTB has been fixed in line with the market demand," a senior official of the Bangladesh Bank (BB), the country’s central bank, told BBN in Dhaka without elaborating.
Bidders offered BDT 2.50 billion for the bond at an auction, held at the central bank on the day, the BB said in its auction result.
“All received bids were accepted. The coupon rate of the accepted bids was 9.3000 percent per annum,” it added.
"Most of the PD banks and non-banking financial institutions (NBFIs) expect that the existing upward trend of interest rate may continue in the near future to curb inflationary pressure on the economy,” a senior treasury official of a PD bank said.
The BB is now allowing only PDs to submit bids in the primary auction of the government securities for April-June period of this calendar year, the central bank officials said.
Non-PD banks and financial institutions are now taking part in the auction only through the PDs, they added.
The central bank of Bangladesh earlier selected 15 PDs -- 12 banks and three NBFIs -- to handle government-approved securities in the secondary market.
Currently, four government bonds - 5-year, 10-year, 15-year and 20-year - are being traded in the market.
BBN/SSR/SI-12Apr11-9:14 pm (BST)
