19 May 2006
NEW ARRANGEMENTS FOR TENDERS OF COMMONWEALTH GOVERNMENT SECURITIES
Following an open tender for procurement of a new electronic system for the collection and processing of tender bids for the issue of Commonwealth Government Securities (CGS), the Australian Office of Financial Management (AOFM) has selected the Bloomberg Auction System (BAS).
Tenders for the issue of CGS, such as Treasury Bonds and Treasury Notes, are currently conducted on behalf of the AOFM by the Reserve Bank of Australia. BAS will be operated by the AOFM and is expected to be in place in late 2006.
The new tender system is aimed at further enhancing arrangements for the issue of CGS and ensuring the Australian Government continues to issue CGS on the best possible terms. Improvements from the use of BAS for CGS tenders include the use of plausibility limits to reduce the scope for erroneous bids to be lodged, and the potential to reduce further the period between the closing time for the lodgement of tender bids and the announcement of tender results.
Over coming weeks the AOFM will be in contact with the parties that participate in CGS tenders about the planned implementation of the new tender system.