The Central Bank of Oman (CBO) recently raised OMR15 million through the allotment of treasury bills. These highly secure financial instruments were issued by the Ministry of Finance for two different maturity periods – 28 days and 91 days. The value of the allotted treasury bills for the 28-day period amounted to OMR3 million, with an average accepted price of OMR99.640 for every OMR100. The average discount rate and yield for this period were 4.69286 per cent and 4.70981 per cent, respectively. On the other hand, the allotted treasury bills for the 91-day period amounted to OMR12 million, with an average accepted price of OMR98.732 for every OMR100. The average discount rate and yield for this period were 5.08476 per cent and 5.15005 per cent, respectively.
Treasury bills are short-term financial instruments that provide licensed commercial banks with the opportunity to invest their surplus funds. The CBO acts as the Issue Manager for these instruments and also offers additional benefits such as ready liquidity through discounting and repurchase facilities (Repo). The interest rate for Repo operations with CBO is 6.00 per cent, while the discount rate on the Treasury Bills Discounting Facility with CBO is 6.50 per cent. These treasury bills help promote the local money market by creating a benchmark yield curve for short-term interest rates, and the government may also use them as a financing option for its recurring expenditures.
Overall, the recent allotment of treasury bills by the CBO highlights the importance of these financial instruments in the Omani financial market. With their high level of security and potential for attractive yields, treasury bills serve as a valuable investment option for commercial banks looking to optimize their surplus funds. Additionally, the role of the CBO as the Issue Manager for these treasury bills ensures transparency and efficiency in the issuance process, further enhancing their appeal to investors. As the government continues to rely on treasury bills for financing its expenditures, these instruments are likely to remain a key tool in the Omani financial landscape for the foreseeable future.
