T-bill subscriptions
reach $18 billion

Certificates of deposit worth

$47 billion issued in 2017

Subscriptions to treasury bills (T-bills) last year increased 20 percent to $18 billion compared with the previous year, according to the 2017 ‘Monetary Policy’ report of the Central Bank (BDL).

This compares with a surge of 39 percent in 2016, driven by the major financial engineering operations carried out by BDL that year.

The excess of the value of subscriptions over that of maturing T-bills totaled $794 million in 2017 compared, with $2.5 billion in the previous year.

The nominal value of issued and sold certificates of deposit (CDs) reached $47 billion last year. Those issued in lira increased 3.6 percent to $23.8 billion. Dollar CDs rose six percent to $23.2 billion.

BDL’s aims from the financial engineering operations include bolstering its foreign currency assets, reducing the cost of public debt, and beefing up the capital base of banks.

These financial operations involve swapping T-bills held by BDL against Eurobonds issued by the Ministry of Finance and denominated in the U.S. dollar. At a second stage, BDL sells CDs in addition to the Eurobonds to the banks against cash in dollars. This is followed by a third transaction consisting of BDL subscribing to T-bills and CDs in liras held by the banks. The last operation is offered to banks at attractive rates.