User Guide for Authorised Bidders – Sep 2006
Contents
1. Australian Government Australian Office of Financial Management AUSTRALIAN OFFICE OF FINANCIAL MANAGEMENT TENDER SYSTEM USER GUIDE FOR AUTHORISED DEALERS September 2006 Treasury Building Langton Crescent CANBERRA ACT 2600 e Telephone 61 2 62631111 e Facsimile 61 2 6263 1222 2 AUSTRALIAN OFFICE OF FINANCIAL MANAGEMENT TENDER SYSTEM Introduction The Australian Office of Financial Management Tender System Tender System is the system used by the Australian Office of Financial Management AOFM to conduct tenders for the issue of Australian Government Treasury Notes and Treasury Bonds The Tender System is accessed via the BLOOMBERG PROFESSIONAL Service Bids for stock offered for sale via the Tender System may only be submitted by parties that are registered with the AOFM Registered Bidders and who are subscribers to the BLOOMBERG PROFESSIONAL Service To register requires entering into a Registered Bidder Agreement with the AOFM which binds the Registered Bidder and AOFM to the AOFM Tender System Conditions of Operation copies of which are available on the AOFM website at www aofm gov au The contact telephone number for enquires concerning registration is 61 2 6263 1141 Each Registered Bidder is required to lodge with the AOFM a list of Authorised Dealers Authorised Dealers are the persons authorised by a Registered Bidder to lodge bids in the Tender System for the Registered Bidder A list of Authorised Dealers m2. been committed may be altered or revoked prior to elapse of the time for closure of the tender according to the countdown clock in the Tender System A bid may be altered by a Authorised Dealer entering a new amount and or yield in the relevant box for an existing bid and then typing lt GO gt 99 lt GO gt A bid may be revoked by a Authorised Dealer by placing an X in the box next to the bid to be revoked in the column marked DEL and then typing lt GO gt 99 lt GO gt VERY IMPORTANT It is essential that lt GO gt 99 lt GO gt is typed for a bid to be successfully altered or revoked The alteration or revocation of a bid can be confirmed by a Dealer viewing their bid blotter accessed by typing BAUC lt GO gt This is particularly important for bids that have been altered as commitment of an alteration cannot be confirmed by viewing the Bid Entry Screen 10 ANNOUNCEMENT OF TENDER RESULT Tender results are announced as soon as possible following elapse of the closing time for the lodgement of bids In normal circumstances the AOFM aims to announce tender results within 5 minutes of the tender closure time When a tender result has been finalised Authorised Dealers receive a green banner message across the top of their Bloomberg screens informing them that tender results are available for viewing Authorised Dealers can view summary tender results by typing AGAN lt GO gt and then selecting the tender for which they wish to view the res
3. noon Australian Eastern Standard Time with the closing time for the lodgement of bids being 12 15 pm Australian Eastern Standard Time the next day Tuesday Note All references in this document to Australian Eastern Standard Time refer to Australian Eastern Daylight Saving Time when Daylight Saving Time applies in New South Wales 4 Treasury Notes are issued on an as required basis depending on the Government s short term funding needs Tenders for Treasury Notes are normally officially announced on a Tuesday at 4 00 pm Australian Eastern Standard Time with the closing time for the lodgement of bids being 12 15 pm Australian Eastern Standard Time the next day Wednesday Official notification of tenders is provided via the AOFM website www aofm gov au and the AOFM email service Wire services such as AAP Bloomberg and Reuters also broadcast tender announcements Lodgement of Bids The date and time from which bidding can commence for a tender will be stated in the Bloomberg message sent to Authorised Dealers notifying them of the tender This will generally be 30 minutes prior to the closing time for the lodgement of bids This means the time period bids can be lodged is generally between 11 45 am and 12 15 pm Australian Eastern Standard Time Authorised Dealers are able to lodge bids by typing AGMT lt GO gt This screen lists AOFM tenders and their status see below The Authorised Dealer should select the relevant tender
4. AL Service there may be some changes to normal procedures particularly in relation to tender announcements and the period of time taken to announce tender results after the close of bidding 13 Where possible the RBA will attempt to provide advance warning to Authorised Dealers of any changes to normal procedures This may not always be possible particularly in circumstances where the RBA is required to take responsibility for the conduct of a tender at short notice If the RBA is required to conduct a tender on behalf of the AOFM the tender will be conducted by the RBA s Domestic Markets Desk The contact telephone number is 61 2 9551 8321 TECHNICAL SUPPORT AND QUERIES AOFM For AOFM related queries dial 61 2 6263 1141 61 2 6263 1139 or 61 2 6263 1111 Bloomberg For Bloomberg related queries type IB HELP lt GO gt on Bloomberg to open an instant message dialogue with Bloomberg s 24 x 7 global help desk Specify Bond Auction TSCC in your instant message query to direct the query to staff specialising in the Bloomberg Auction System To contact your local Bloomberg representative hit the lt Cancel gt or lt Escape gt button on your Bloomberg keyboard for your Bloomberg account representative s contact details To contact Bloomberg s global customer support switchboard dial 61 2 9777 8600
5. er data such as futures pricing The limits set by the AOFM will be 5 basis points either side of the observed or estimated mid market yield Plausibility limits will be set by the AOFM just prior to the start of the period when bidding is permitted which is 30 minutes prior to the closing time for the lodgement of bids The limits will be updated if necessary 15 minutes prior to the closing time for the lodgement of bids Further updates will be undertaken on a best endeavours basis in the period less than 15 minutes to tender closure where a yield is judged to have moved by 3 or more basis points Bid Commitment Once a bid or bids have been entered they need to be committed Only bids that have been committed are valid bids Bids that have been entered but not committed prior to tender closure are not valid bids Bids are committed by typing lt GO gt 99 lt GO gt When a bid is committed the box under the column marked STATE for the bid in question will be marked SENT The corresponding boxes under the columns marked DATE and SEQNO will also be filled In the sample Bid Entry Screen shown above the first three bids have been committed but the fourth bid for 100m at a yield of 5 865 has not been committed A committed bid that has not been revoked prior to tender closure constitutes an irrevocable promise by the Registered Bidder Bid Blotter IMPORTANT TIP It is highly recommended that at the same time that Authorised Dealer
6. from the list for explanation for similar functions P2795f Govt AGMT AUSTRALIAN GOVT AOFM List of Tenders In this example two lines of Treasury Bonds are being offered at tender The Authorised Dealer should select the security bond or note line for which they wish to enter bids for explanation P279 f Govt AGMT Bond Tender No XYZ Closing Date 08 18 06 ii Enis 28m425s 6 15 11 315719 BID ENTRY SCREEN for anation P279 f Govt AGMT 99 lt GU gt To Before Paging MULTIPLE BID ENTRY Bond Tender No XYZ DATE SEQNO Brazil 5511 3048 4500 zil 55 81 3 3201 8900 Singapore 65 6212 1000 U S Closing Date and Time The closing date and time for the lodgement of bids is displayed in the top right hand corner of the Bid Entry Screen There is also a countdown clock which displays the remaining time left to lodge bids At the closing time the Tender System flashes a bidding closed message and prohibits the commitment of any further bids Amount Each bid must be for a minimum amount of one million Australian dollars face value and in multiples of one million Australian dollars for bids in excess of the minimum The amounts bid are recorded in the Tender System as millions MM For example a bid for 50 million 50 000 000 should be entered as 50 In allotting stock at the highest accepted yield amounts by which the total bids from any one Registered Bidder exceed the amount offered at tender w
7. ill be disregarded Yield All tenders for the issue of Treasury Notes and Treasury Bonds are conducted on an outright yield basis Yield bids must the submitted on the basis of yield to maturity per annum When entering a yield bid the sign should not be entered e g a yield bid of 10 25 should be entered as 10 25 7 For Treasury Notes the yield bid may be expressed to a maximum of two decimal places e g 10 10 0 or 10 00 Any additional decimal places will not be accepted For Treasury Bonds the yield bid may be expressed to a maximum of three decimal places e g 10 10 0 10 00 or 10 000 Yield bids for Treasury Bonds must be a whole multiple of 0 005 e g 10 000 10 005 or 10 010 Yields submitted that are not a whole multiple of 0 005 will not be accepted The Tender System includes plausibility limits for yield bids When an Authorised Dealer seeks to commit a yield bid which falls outside a range specified by the AOFM the yield bid in question will be highlighted and a message will appear at the top of the Bid Entry Screen indicating that the bid is outside a specified range Following the warning the Authorised Dealer has the option of continuing to proceed with commitment of the bid by typing 99 lt GO gt or modifying the bid The AOFM will set plausibility limits based on prevailing market quotes observed for the securities in question or the AOFM s estimate of expected pricing based on oth
8. ked to send another email or facsimile detailing the bids placed by telephone Should an Authorised Dealer be unsure whether their bids have been received in the Tender System they may telephone the AOFM to confirm whether or not their bids have been received In such instances they should telephone either 61 2 6263 1141 61 2 6263 1139 or 61 2 6263 1111 Widespread problems In the case of problems affecting the AOFM s administration of a tender including failure of the Tender System a scheduled tender may be cancelled or rescheduled This may include rescheduling a tender to a later time on the same day or extending the period for the acceptance of bids In the event of failure of the BLOOMBERG PROFESSIONAL Service the AOFM may request that bids be submitted by email In this event Authorised Dealers will be requested to send email bids to cgstenders aofm gov au All Authorised Dealers will be informed of any changes to the timing of a tender and or changes to tender arrangements RBA conduct of tenders The RBA may conduct tenders on behalf of the AOFM in circumstances where the AOFM is not able to conduct tenders due to technical problems or other reasons In such instances tenders may be conducted by the RBA using the Tender System accessed via the BLOOMBERG PROFESSIONAL Service or by other means advised by the RBA In cases where tenders are conducted by the RBA using the Tender System accessed via the BLOOMBERG PROFESSION
9. led on the second day following the tender 12 BUSINESS CONTINUITY PROCEDURES Problems limited to a single or small number of Registered Bidders Where the AOFM has reasonable grounds for believing that a technical fault or circumstances beyond a Registered Bidder s control are preventing its Authorised Dealers from entering bids in the Tender System prior to closure of tender bidding the AOFM may at its discretion accept telephone bids from the Registered Bidder concerned An Authorised Dealer should telephone the AOFM to explain the nature of the fault and to place the Registered Bidder s bids In such instances they should telephone either 61 2 6263 1141 61 2 6263 1139 or 61 2 6263 1111 Telephone bids must be placed and read back by an AOFM employee prior to elapse of the time announced for closure of the tender according to the clock in the Tender System Telephone bids must be confirmed by email by the Authorised Dealer as soon as possible following their placement The email should be sent to cgstenders aofm gov au In circumstances where a failure also extends to the Registered Bidder s email system bids should be confirmed as soon as possible by facsimile to 61 2 6263 1222 In the event of discrepancies between telephone bids and subsequent email or facsimile confirmation the AOFM will check telephone tapes of the bids being placed The bids placed by telephone will stand and if necessary the Registered Bidder will be as
10. s are entering their bids they have another Bloomberg panel open displaying the Bid Blotter which is accessed by typing BAUC lt GO gt The Bid Blotter displays all the bids committed or revoked by the Authorised Dealer and is updated automatically after the Authorised Dealer has typed lt GO gt 99 lt GO gt in the Bid Entry Screen Authorised Dealers should verify that what is displayed by the Bid Blotter correctly records their intentions If it does not this is likely to be because the Authorised Dealer has failed to type lt GO gt 99 lt GO gt in the Bid Entry Screen Authorised Dealers can view only their own bids via the Bid Blotter The Bid Blotter can be used by Authorised Dealers to sort their bids using different criteria For example bids can be sorted by security yield or sequence number for explanation for similar functions P2795f Govt FAXKM BID seq number 4 sent 21 56 11 ixed Income Blotter Intraday Blotter 18 August 2006 Page Al 11 Security l Fira Qty HM Yield Seq TS Status UserName Tiner ID 06 15 11 AUSTRALIAN 06 15 11 AUSTRALIAN 06 15 11 AUSTRALIAN 06 15 11 AUSTRALIAN 03 15 19 AUSTRALIAN 03 15 19 AUSTRALIAN 03 15 19 AUSTRALIAN 03715719 AUSTRALIAN GERALD DODGSON GERALD DODGSON GERALD DODGSON GERALD DODGSON GERALD DODGSON GERALD DODGSON GERALD DODGSON GERALD DODGSON ann annnwn man aon a OM amp WB NH Bid Alteration and Revocation A bid which has
11. ults or explanation P279 f Govt AGAN SUMMARY SSE Total Amount Allocated Total Number of Bids Total Amount of All B Total Number of lt Yield Allo r 5 So F ag t eld Allocated in Full f Bids Allocated in Full ely ie imum Bid Yield Cut off Minimum Bid Yield Cut Off Bid to Cover Ratio 65 6212 1000 11 Authorised Dealers can view their own tender allotments by typing AGAL lt GO gt and then selecting the tender for which they wish to view the allotments After selecting the tender for which they wish to view allotments they should select the option Post Allocation for explanation P279 f Govt AGAL ACGB 5S Oo6 1IS 11 400 MM System Number 2 By Yield Page ibe l AN OFFICE OF 5 850 200 200 200 100 0 AN OFFICE OF 5 65 4 75 100 0 N OFFICE OF 5 860 50 125 125 83 3 AN OFFICE OF 00 OFFICE OF Tota 5212 1000 U S Eu Summary tender results are also announced via the AOFM website www aofm gov au the AOFM email service and other wire services such as AAP and Reuters SETTLEMENT OF ACCEPTED BIDS The Reserve Bank of Australia is the settlement agent for the AOFM Unless otherwise specified in the official announcement of a tender settlement of accepted bids will be in the Austraclear System during System hours as defined in the Austraclear System Regulations and Operating Manual Treasury Notes are normally settled the day following the tender Treasury Bonds are normally sett
12. ust identify each Dealer by their Bloomberg User Name and Bloomberg Identity Number UUID Only persons identified on such a list will be enabled by the AOFM to use the Tender System It is the responsibility of the Registered Bidder to ensure their list of Authorised Dealers is current and up to date This guide has been designed to assist Authorised Dealers in their use of the Tender System After logging on to the BLOOMBERG PROFESSIONAL Service the main menu for the Tender System can be accessed by typing AGTS lt GO gt The functions available for use by Authorised Dealers are those on the right hand side of the screen listed under the heading Participants KAEI e CERTENA Hep for explanation for similar functions Govt AGTS Issuers Participants gt TSUP Tender Setup 9 AGMT Tender Offering Enter Bids AGAL Tender Allocation 10 AGAL Tender Allocation AGAN Tender Results Summary AGAN Tender Results Summary TENC Non competitive Limits 12 BAUC Bid Blotter TENB Tender Bids TAD Allocation Breakdown ENAB Enable Users BAUC Bid Blotter r for explanation Here Hen for 24hr assistance Tender Announcements All Authorised Dealers will be automatically sent a message via the Bloomberg message system each time a tender for the issue of Treasury Notes or Treasury Bonds is announced by the AOFM The message includes details such as the tender number the bidding start and closing dates and times and the securities on offer see e
13. xample below e IMPORTANT It should be noted that Bloomberg uses a date format of MM DD YY For example 18 August 2006 is displayed as 08 18 06 This date format is utilised throughout the BLOOMBERG PROFESSIONAL Service including the Tender System Govt MELE gt DELETE 2 lt GO gt R Y 3 lt GO gt FORWARD lt GO gt MENU OF OPTIONS 9 189 9 01 07 GERALD DODGS STRALIAN OFFICE OF Sent by or from generic login Amt MM 5 15 06 11 Go 3 5 ao 0 Ergi 9 G U up an additio i Om of t CGB 5 75 11 at the weighted ge iss 00 Europe 44 0 Japan 8 89 65 6212 1000 U S 1 It is recommended that Authorised Dealers subscribe to the AOFM email service Subscription is free and provides email notification of AOFM Operational Notices and other public announcements including tender announcements and results To subscribe go to www aofm gov au subscription asp An indicative issuance calendar for the issue of Treasury Bonds is published prior to the commencement of each financial year normally in mid May following the release of the Australian Government Budget The calendar can be viewed at www aofm gov au content borrowing calendar asp The calendar outlines expected tender dates bond lines and face value amounts for Treasury Bonds to be offered The calendar is indicative only tenders are not officially announced until the day prior to the day of a tender Tenders for Treasury Bonds are normally officially announced on a Monday at
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