Bond auction acceptance falls short

By First Capital Research   

CBSL concluded the scheduled T-Bond auction yesterday, following which the secondary market saw some trading activity; however, volumes remained insufficient to prompt any movement in the yield curve. 

Among the traded maturities, the 15.09.2029 bond was executed at a yield of 9.53%, while the 15.12.2029 bond traded at 9.55%. Meanwhile, the 15.05.2030 and 01.07.2030 maturities saw trades around 9.70%. 

At yesterday’s T-Bond auction, CBSL raised only part of the targeted Rs. 155.0bn.The initial plan aimed to raise Rs. 85.0bn through a 2030 maturity bond carrying an 9.75% coupon, Rs. 25.0bn via a 2032 maturity bond with a 9.00% coupon and Rs. 45.0bn via a 2035 maturity bond with a 10.70% coupon.

However, only Rs. 46.2bn was accepted from the 2030 bond, while the 2032 and 2035 bonds successfully raised their full initial offerings. In the forex market, the LKR depreciated slightly against the greenback, closing at Rs. 302.0/USD, compared to the previously seen rate of Rs. 301.9/USD. Meanwhile, overnight liquidity in the banking system expanded to Rs. 169.6bn from the previously seen level of Rs. 160.6bn.