Dhaka, Bangladesh (BBN) - The yield on 15-Year BGTBs and 20-Year BGTBs increased slightly on Tuesday as banks may express unwillingness to invest their liquidity in the long-term securities.
The cut off yield, generally known as interest rate, on the 15-Year BGTBs rose to 12.70 per cent on Tuesday from 12.65 per cent earlier while the yield on the 20-Year BGTBs reached at 12.80 per cent from 12.75 per cent.
The government borrowed nearly BDT 20.08 billion instead of BDT 40 billion pre-auction target through issuing the treasury bonds on the day to partially meet its budget deficit, according to the auction result.
“A few number of banks did not participate in the auction as the two-types of bonds were re-issuing that duration risk was higher,” a market insider explained.
Currently, five government bonds, with tenures of two, five, 10, 15 and 20 years respectively, are traded on the market.
On the other hand, four 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.