RBZ in market with third batch of TBs

Harare, (New Ziana) – The Reserve Bank of Zimbabwe (RBZ) on Wednesday returned to the market with treasury bills (TBs) to raise $100 million.

This is the third batch of TBs that the central bank has publicly floated in the past 60 days after it issued two others worth a combined $90 million last month.

The bills, which were overwhelmingly oversubscribed, were all meant to raise funding for government operations.

The latest issue is a 92-day instrument whose purpose is once again to mobilise funding on behalf of the government.

“The Reserve Bank of Zimbabwe (RBZ) hereby invites financial institutions including commercial banks, building societies, POSB, IDBZ, insurance and pension funds and other corporates to subscribe to treasury bills amounting to raise one hundred million dollars,” the central bank said.

Investors are restricted to a maximum of two applications, of a minimum $1 million each.

The offer opens on Wednesday, 25 September and closes on 26 September.

The bills, which have an “open tender on yield basis” interest rate, have other special features which include prescribed and liquid asset status, tax exemption and acceptability as collateral for overnight accommodation at the RBZ.

Treasury bills are considered one of the safest forms of investment in the world as they are issued and backed by governments with little risk of default when it comes to payment on maturity.

Issuance of TBs had become a highly controversial issue in the previous administration as the government raked up billions in debt through the instrument as well as a central bank overdraft facility to bridge its budget deficit.
New Ziana