eBusiness Weekly
Tawanda Musarurwa
HARARE – The Reserve Bank of Zimbabwe (RBZ) is hoping for better fortunes in its latest Treasury Bills (TBs) auction, aimed at raising $300 million to fund Government operations.
The central bank has this year undertaken five TBs auctions “to fund Government operations” in batches of $30 million, $60 million, $100 million, $300 million and $150 million, respectively.
While the first three were oversubscribed, the last two have been undersubscribed.
Zimbabwe’s apex bank today floated 182-day TBs, in the sixth TBs auction since resumption of the auction system this August.
The RBZ said the paper was open for subscription by financial institutions including commercial banks, building societies, the Post Office Savings Bank and the Infrastructure Development Bank of Zimbabwe.
There have been concerns that the limited range of institutions that the last few TBs auctions have been open to, is a major cause of the low subscription rates. Pensions funds, for example, are curiously excluded.
Other observers have pointed to the effects of an inflationary environment.
The latest TBs, whose interest rate is on an “open tender on a yield basis,” would open for subscription on Tuesday, 12 November, with those interested in subscribing limited to a four-hour window.
Other special features on the bills include a prescribed and liquid asset status, tax exemption and acceptability as collateral for overnight accommodation at the central bank.
According to the central bank, applications are limited to a minimum of $1 million, with each investor restricted to two bids only.
