The Ministry of Public Finances decided on Monday to suspend temporarily all issuing to the population of treasury bills with maturity periods of 90 and 180 days.
Reasons given for the move included the extension of the maturity for ROL-denominated government securities, which was agreed with the International Monetary Fund, and the level of the available resources for budget deficit financing for 2005.
The need to reorient the maturities of the budget financing sources and the satisfactory level of the available amounts in the treasury account were also given as justifications for the freezing of T-bill issues in August 2004. That decision threw the market into turmoil at the time, and many players saw their investment possibilities shrink considerably.
As a result, treasury certificates aimed at the population were the only instruments with a maturity under one year that were left in the portfolio of the Ministry of Public Finances. This was justified in terms of protecting the population's savings, which are considered low-risk placements and offer a stable yield.
Owners of T-bills now have the option to have the bills redeemed at the due time or to convert them to deposits with the state treasury. The conversion operation will be performed automatically at the time bills become due.
The Finance Ministry set interest rates for time deposits at 12.5% per year and at 1.5% per year for sight deposits, with the rates to come into effect starting January 17.
Owners of the certificates enjoyed an interest rate of 13.5% per year for the 90-day maturity and of 14% for the 180-day term. liviu.chiru@zf.ro
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