NBKR Treasury Notes 

(December 2007) 

In December, the National Bank continued to gradually increase the volumes of weekly issued NBKR notes in all market segments. Along with this, in the context of the growth of excessive liquidity in the banking system, the demand for 14-day and 28-day notes increased during the reporting period as a result, their yield went down. However, the demand in the 3-month and 6-month NBKR notes segments remained at the low level: two out of four announced auctions for 3-month notes allocation and all four announced auctions for 6-month notes allocation were called off due to the high yield volatility or insufficient number of participants. 

In December, the average monthly yield of all types of notes decreased by 0.8 points and amounted to 8.6 per cent. The yield of 14-day and 28-day NBKR notes also decreased by 0.8 point down to 8.5 and 8.7 per cent, respectively. The average monthly yield of 3-month notes reduced by 0.4 points down to 9.4 per cent.  

The average weekly volume of requests submitted for the purchase of NBKR notes increased almost twice in the reporting month as compared to November, having made KGS 486.9 Million, and the weekly average amount of note sales increased by 82.9 per cent and reached KGS 311.8 Million. 

The volume of NBKR notes in circulation increased 2.2 times in December, and amounted to KGS 1433.3 Million. The share of commercial banks within the structure of the NBKR notes holders decreased down to 82.3 per cent, and the share of resident legal entities increased up to 17.7 per cent. In addition, resident individuals purchased the NBKR notes in December, but their share in the structure of the NBKR notes holders was negligible. The number of commercial banks holding NBKR treasury notes increased from 10 to 11 banks, and the NBKR treasury notes portfolio concentrating index increased in December from 0.21 to 0.22, which indicated the high level of concentration and the market presence of four market players with equal market shares.