Dhaka, Bangladesh (BBN) - The yield on Two-Year BGTBs almost remained unchanged on Tuesday as banks expressed their willingness to invest funds in the securities.
The cut off yield, generally known as interest rate, on the BGTBs came down to 12.2998 per cent on the day from 12.30 per cent earlier, according to auction result.
The government borrowed BDT 40 billion through issuing the BGTBs on the day to meet its budget deficit partly.
Besides, the government borrowed BDT 3.0 billion as per announcement on the day through issuing Three-Year Floating Rate Treasury Bonds (FRTBs).
The cut off yield on the FRTB stood at 13.19 per cent.
The FRTB is a bond whose coupon is determined by adding spread with benchmark 91 days Bangladesh Compounded Rate (BCR).
The BCR is a daily rate based on the cut-off yield of 91-Day Treasury Bills (T-bills) auction. This is a reference rate which is primarily used to set the rate of floating rate instruments of the government.
Currently, five government bonds, with tenures of two, five, 10, 15 and 20 years respectively, are traded on the market.
Besides, four treasury bills (T-bills) are transacted through auction to adjust government borrowings from the banking system.
The T-bills have 14-day, 91-day, 182-day and 364-day maturity periods.
BBN/SSR/AD