Archived - Appendix A - Sovereign Comparison Summary 

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As shown in the table below, the general approach to auctions is similar across sovereigns, but there are different approaches to the trade-off between predictability and transparency, especially in times of market turmoil. Australia has chosen to increase flexibility at the expense of predictability and no longer announces its issuance calendar in advance. The UK retains flexibility by choosing the specific security to be issued based on the needs of the market, and as mentioned above, holds mini tenders to raise smaller sums. In contrast, the US stresses the need for regularity and predictability. It holds more than 200 auctions per year and follows a strict schedule of issuance, so the market knows which maturities will be issued well in advance. The quantity in each auction is also fairly predictable. In this sense, Canada’s process is similar to that in the US, in that its auctions are predictable. However, especially in times of market stress, the US could be considered to be a special case. Its markets are extremely liquid and deep, and US auctions benefit from a flight to quality in times of uncertainty.

An important difference across sovereigns is the frequency of new issues compared to re-openings. The bulk of auctions in the US and France are new issues, while in Canada, as well as in the UK and Australia, re-openings are most common. For re-openings, price discovery is helped by a liquid secondary market. New issues need a liquid WI market to achieve satisfactory price discovery. New issues and re-openings also have different implications for combating short squeezes.

Sovereign are aware of the possibility of abusive practices by bidders. To prevent a market corner or a short squeeze, the US strictly limits the quantity that can be awarded to any one bidder. Other than Australia, the other sovereigns, including Canada have similar limits. Australia relies on its flexibility to re-open an issue on an ad hoc basis if there appears to be a market distortion caused by the concentration of holdings.

Participation varies across sovereigns. The US allows broad access, even having a system that allows direct customer participation. At the other extreme, Australia limits participation to a specific list of institutions. The remaining countries are in the middle. All of the sovereigns we interviewed have a category of bidder similar to primary dealers. Other than in Australia, primary dealers have auction participation requirements to maintain primary dealer status. Only Canada has a significant minimum participation requirement that must be fulfilled in each individual auction.

Non-competitive bidding also varies across sovereigns. In Canada, the US and France, non-competitive bids are intended to permit small bidders to achieve allocation at auction and are restricted to small quantities. However, in the UK, the role of non-competitive bids is to allow primary dealers a guaranteed supply, and they are permitted to buy up to 10 per cent of the auction non-competitively.

In some areas for which sovereigns differ, e.g., reporting requirements by bidders prior to auctions, Canada’s requirements are in the middle ground compared to the others. In Canada, pre-auction position reporting is required and compliance certificates and spot checking are the enforcement mechanisms. It is possible that a more systematic checking of pre-auction reporting limits is desirable, rather than random spot checks, but it would be labour intensive and it is not clear that the current almost self-monitoring system is subject to violations. The threat of penalty appears to suffice.

The UK has found the use of mini tenders beneficial for matching supply and demand while still giving predictable information at most auctions. The mini tenders may also be useful for situations of potential short squeeze. The UK and France also have a post-auction option giving winning bidders the right to purchase additional securities. These may be worthy of consideration in Canada if concerns intensify about short squeezes or auction success in an environment of increased supply. Similarly, if auction coverage is a concern, a modest increase in the limits on competitive bids could be considered.

It is worth noting that aspects of the auction process differ across the sovereigns, contributing to the overall efficiency of the process. Modifying one or more aspects of the process should be evaluated in the context of the other aspects, since the various pieces work together as part of the broad process.

  Canada flag Australia flag United Kingdom flag United States flag France flag
  Canada Australia United Kingdom United States France
Auction Features
The Bank of Canada is the agent of the Department of Finance for the purpose of administering auctions. Australian
Office of Financial Management (AOFM) is an agent of the Australian government,
and is part of the Treasury portfolio.
The Debt Management Office (DMO) is the agent of the Treasury. No involvement of the Bank of England. Bureau of Public Debt is the branch of the US Treasury responsible for debt auctions. The Bureau of Public Debt issues calls for tenders and announces auction results. The Federal Reserve designates Primary Dealers and carries out certain activities associated with auctions. Agence France Tresor (AFT) defines debt strategy and manages day to day market operations.
AFT manages the auction process on behalf of the Ministry of Economy, Industry and Employment (as of 2001), and works in collaboration with the Ministry. Banque de France receives bids on behalf of the Treasury.

Bonds /Treasury Bills - Multiple price

RRBs - Single price

Multiple price

Conventional Gilts/Bills – multiple price

Index-linked Gilts – single price

Syndication in special circumstances.

Single price

Multiple price

Syndication in special circum-

Securities Auctioned (Type and term)


2, 5, 10, 30 year nominal [37] Longest maturity is 12 years.
65 auctions in past 12 months, only 1 new issue, all others reopening maturing 1 to 12 years.
Conventional gilts – wide range of maturities, in 2009 – range from 3 to 40+ years with an average maturity of 15 years; maturities to be issued chosen in consultation with market participants

Bonds: 30 year

2, 3, 5, 7, 10 years

Bonds (OAT):
10, 15, 30, 50-year. Most are fixed rate, some floating rate pegged to 10-year maturity rate. Maturities and interest payments 25th of the month.
Notes (BTAN): Negotiable fixed rate medium term notes with annual interest. 2 or 5 years. Maturity and interest payment 12th of the month.


30-year RRB TIBs (Treasury Index Bonds) issuance ceased in 2003;
New $4b issue maturing 2025 in Sep 2009 by syndication.
Index-Linked gilts
range of maturities from 15 to 40+ years with an average maturity of 28 years; maturity is not according to any set schedule but chosen in consultation with market participants
5, 10, 20 year
(OATi): as of 2001 linked to Euro inflation rate, previously French inflation. Long term.


3, 6, 12 month Notes:
Maturity of up to 1 year (i.e. bills)
1,3,6 month 4, 13, 26, 52 weeks 2, 3, 4, 6, 12 month
Auction Cycle and Timing


2,3,5, 10 year - quarterly
30 year – semiannual


June 1 and December 1 maturities

Govt of Canada can at its discretion re-open and issue outside the timetable provided by the Quarterly Bond Schedule and the usual cycle for treasury bill issuance.

Twice per week on Wednesdays and Fridays, mostly re-openings

Conventional gilts:
Avoid dates with market moving data. 2-6 times per month on Tuesdays, Wednesdays or Thursdays, mostly re-openings, also includes mini-tenders to permit re-openings as required.

2,3,5,7 year:
12 auctions per year per maturity

10 year:
4 auctions per year + 2 re-openings per issue

30yr: four auctions per year + 1-3 re-openings per issue


Third Thursday each month 11:50am.

New 2 and 5 year every six months, subsequent monthly issues. 2-year BTANs may be increased via fungible auctions.

OATs first Thursday of each month 10:50am


New $4b issue maturing 2025 in Sep 2009 by syndication. First issue since 2003.
Index-Linked gilts:
1-2 times per month on Tuesdays, Wednesdays or Thursdays, mostly re-openings

TIPs: 5 year: one auction per year + one re-opening

10 year: two auctions per year + one re-opening

20 year: one auction per year + one re-opening

OATi s first Thursday of each month (same as BTAN) 10:50am


Biweekly. Notes:
Usually once per week, tenders on Thursdays
Weekly, usually Fridays

4,13,26 week maturity: weekly

52 week maturity: every 4 weeks

BTF - Mondays.
3 month maturities weekly.
6-month and 1-year bills as needed.
4 to 7 week maturities outside calendar as needed.
2009 Typical Auction Size, Total 2009


approx C$3 billion + re-openings
Target benchmarks
2, 3: C$7 to C$10 billion
5: C$9 to C$12 billion
10: C$10 to C$14 billion
30: C$12 to C$15 billion
A$60 billion per year, each tender in the range of A$500 million to A$1 billion. Average approx A$600m.
Conventional gilts:
recent average is £3 billion per offering (range from approx £1-5 billion), mostly re-openings
Record issuance target 2009 - £146 billion

US$10-15 billion

2,3,5,7 year: US$24-42 billion
10 year: US$20-23 billion

Total 30 auctions of BTANs and OATs + 1 syndication and 1 buyback 2008.
OATs €370m to 2.2 billion. BTANs > €3 billion. 10- and 30-year approx €13 b.
2008 gross med- and long-term total €132.0bn, fixed-rate OATs €63.9bn, (BTAN€i, OATis and OAT€is) €15.5bn, BTANs €52.6bn (incl €0.8bn of BTAN with remaining maturity <1yr during 21 July 2008 BTF auction)


approx C$500 million
At least A$1 billion for new issue in 2009 maturing 20 Sep 2025
Index-linked gilts:
Recent average is £1 billion (range up to £5 billion), mostly re-openings
5,10,20 year maturity - US$8 billion
OATi €370 million.
BTFs: €317b in 52 auctions, average €1.5 billion to €4.2 billion.


Approx C$3 billion + re-openings, totalling approx C$15 billion A$17 billion total expected for 2009-10 1 month - £1 billion
3 month - £1.5 billion
6 month - £1 billion
Average US$30 billion, range US$18-40 billion. €1.5 to €4.3 billion
Fungibility Yes Yes. Most auctions are re-openings. 1 new issue every 9 months with varying maturities. Yes. Most auctions are re-openings. Yes. For bonds 7 years and shorter, generally no re-openings. Other bonds and TIPS, re-openings as described above. Yes. Monthly re-opening of 2- and 5-year BTANs.
Do buybacks
If not, when
did they?

Yes. Regular cash and switch bond buybacks to maintain liquid new bond issues. Coordinated with auction cycle.

Regular cash management bond buybacks.

None for inflation-linked.

None 2002 to Sep 2009. Sep 2009 buyback A$700 million (cash A$1.1 billion) of inflation indexed bonds (maturing August 2010) in exchange for new A$4 billion 2025 inflation indexed bond (resumed issuance since 2003)
1997-2002 buybacks of 5 to 7 year bonds to consolidate into fewer lines ( budget surplus)

From the early 1990s to 2000-01 regular buybacks of short-dated nominal bonds (< 9 months to maturity) for cash management. Purchased from the Reserve Bank, which had acquired them in open market operations.

Buybacks and reverse auctions ceased in 2001 and were viewed as helpful for maintaining long issuance and liquidity when they were used. March 2000 to April 2002.


First exchange of off-the-run bonds was December 2008.

To smooth issuance cost between years (buy back securities maturing within 2 years) and to smooth yield curve and valuation of old off the run bonds.

Buyback timing
and size relative
to auction
(when they
did occur)
Call for tenders is one week prior to auction. Annual target 09/10 C$2.4 billion, lower than past years. Bonds in maturity bucket near auctioned bond, excluding building benchmarks, current and previous benchmarks and bonds >25 years. Bonds selected in consultation with market.
Cash mgmt buybacks (bonds <18 months to maturity, >C$5 billion, not to be reduced below C$3 billion) to reduce high levels of cash balances needed ahead of large bond maturities Tuesdays 11:15 after most biweekly treasury bill auctions.

Bond buybacks from 10 per cent to 50 per cent of gross issuance 1997-2002.

For short-dated buybacks, up to 70 per cent of the face value amount of the bond on issue. A typical bond line then roughly A$5 billion. No relationship to auction timing – purchased from Reserve Bank.

  45 buyback operations; average US$1.5 billion spread over 10 bonds In 2008, bought back €2.3 billion in OATs and BTANs maturing in 2009 in over-the-counter transactions and €1.1 billion maturing in 2032 as part of the first exchange of an old 30-year bond for a new one on December 4, 2008. Was in response to strong demand for 30-year OATs. Subject to minimum bid ratio for old for new securities. No impact on borrowing program.
Initial Communication
from Policy
vs. Issuing
Quarterly bond schedule announced by Bank of Canada on behalf of Ministry of Finance. AOFM makes announcement. DMO announces annual issuance calendar. U.S. Department of the Treasury announces Quarterly Refunding Statement. Calendar announced by AFT annually. Target 10 per cent OATi
Timing relative
to auction date
Quarterly Used to announce issuance program one year in advance; not now.

Annual issuance calendar – once a year – report dates and whether conventional or index-linked

Quarterly announcements – which gilts will be issued

-announcements are last business day of March, May, August and November at 15:30

Schedule of Treasury securities auctions is released at Treasury’s Quarterly Refunding Press Conference (first Wed of Feb, May, Aug & Nov)

OATs: annual calendar

BTANs: semi-annual calendar. August, Dec annual amount. May change date or remove auction.

BTFs: quarterly calendar

Term type, call for tender date, auction date, auction method, delivery date, amount maturing. Broad indications of issuance intentions For new issues, maturity but not coupon. Details include maturity, expected announcement dates, auction dates, and settlement date. May change dates after consulting with SVTs and announce for remainder of year.
Other comments Quantities are not announced.     Quantities are not announced. Quantities are not announced.
Call for Tenders
Timing relative
to auction date

Week prior to auction at 3:30pm

Week prior to auction at 3:30pm

Week prior to auction at 10:40am

Noon on Friday of preceding week for tender on Wed and Fri
Confirmed one day ahead


Wednesday at 4pm for Thursday tender

gilts (conventional and index-linked):
Tuesday of week preceding auction (auctions are Tues/Wed/Thurs)

Call for tenders announced with results of tender of previous auction; auctions held weekly for 1/3/6 month bills

2-7 days ahead of auction

5 year – approx 2 weeks in advance;
10 year – one week or less in advance;
20 year – one week or less in advance

4 week – announced Monday for Tuesday auction
13/26 week – announced Thursday for Monday auction
52 week – announced Thursday for Tuesday auction

Friday preceding auction for OATs, BTANs and inflation linked (i.e. 4 days prior to auction),

BTFs: two business days prior to auction

Auction information

Quantity is announced

Maturity Date

-details of bond lines and amounts
-coupons are pre-determined and set one business day before auction; this info is sent out in final announcement


details of tenors and amounts to be offered

Quantity is announced Quantity is announced

BTANs and OATs: List of lines to be issued, range of possible total amounts to be issued, auction and settlement dates.

BTFs: exact amount of the lines to be issued, in accordance with the quarterly calendar

Other information
  System sends out announcement to registered bidders   Supplementary details such as amount of maturing debt  
When-Issued /
Secondary Market (Bonds, ILBs
and Treasury bills)
Yes for nominal bonds and Treasury bills

No WI market for new issues

Bond futures market is important for pre-auction price discovery

Gilts can trade WI 7 days prior to auction for new issues

Small amount of WI trading

Secondary market for reopening

For new issues, WI market starts with announcement

WI is very active but not monitored or regulated by Treasury

For reopening, very active secondary market exists

OATs: “gray market” 2 to 5 days prior to monthly auctions until settlement. Value date is the auction settlement date, with accrued calculated to that date
BTFs WI market same rules as secondary.

Central Bank
(add-on vs.
in the auction)
Yes, without restriction. Not as add on. Reserve Bank of Australia is the only government participant and the only one who can submit non-competitive bids. This is done irregularly and currently only for new issues (e.g. A$50 million of new 11-year in April 2009 was the only purchase since October 2008). Participation and amounts is pre-announced. Interviewee felt this was unimportant since the amount is small. None Fed can acquire or replace securities that are maturing up to that amount and no more. Can acquire on behalf of foreign central banks on a non-competitive basis, but rare now. For its own account, is an add-on so does not affect the auction. None

12 primary dealers for bonds. 10 for treasury bills.

Significant participation in primary and secondary market for Government of Canada securities.

Registered bidders are only possible bidders. Currently 16. 15 GEMMs (Gilt edged market maker) 18 Primary Dealers designated by the Fed Currently 18: 4 French institutions and 14 non-resident.
Primary Dealers (SVTs) selected by Minister in charge of Economy on recommendation of Chairman of AFT and selection committee. SVT charter (revised June 2006) governs relationship with Primary Dealers valid for 3 year term.
Other Government Securities Distributors
None Through GEMMs Broad participation of dealers Any institution affiliated to Euroclear France and holding an account with Banque de France.
Customers Through government securities distributor. Participate in secondary market. Registered bidders are transacting as principal, not brokers or agents. In practice registered bidders do lodge bids that are their customers’, but the registered bidder is fully responsible for the bid. Through GEMMs Bidding is open to everyone but must be submitted through a broker dealer registered with SEC or depository institution. Also a non-competitive basis through BPD’s Treasury Direct System. Rarely participate. If so, through a dealer.
Pre or Post Auction position reporting
by bidder type
All bidders (including customers with bidder identification numbers) must report net position pre-auction, including derivatives and repo. None Required reporting by GEMMs for gilts; no requirement for bills. Any bidder who exceeds 35 per cent limit (of issue) must report. No pre auction requirement. Any institution obtaining >40 per cent of issued volume (excluding non-competitive bids) must inform AFT.
Level of detail
Net position is aggregate of security being offered and derivatives. None GEMMs must report all trades in week between auction announcement and auction as well as net position pre-auction. Position reporting – must notify if exceeds 35 per cent limit. SVTs disclose the identity of main clients or their rationale if the SVT intends to retain a “material fraction” of the obtained volume at auction.
Bidding Requirements
bids (NCB)

Allowed: See below for limits.

Govt securities distributors can submit competitive and non-competitive.

Can only be submitted by Central Bank. Infrequent and only to hold stock of a new bond line.

DMO sets aside 10 per cent of issue for non-competitive bids by GEMMS.

DMO’s approved group of investors (retail) also may submit non-competitive bids.

A bidder cannot bid both competitively and non-competitively. Primary Dealers are not allowed to bid non-competitively. Primary Dealers only. Right to submit NCBs may be withdrawn if fail to participate in an auction.
Primary Dealers

Must submit bids for at least 50 per cent of auction limit or calculated value, whichever is less, within 10 bps of cut-off.

Over time, must submit accepted bids proportional to secondary market share.

Must satisfy all requirements of other dealers below, and:

Designated as Primary Dealer when its bidding limit reaches 10 per cent based on primary and secondary market shares (if drops below, have 6 months to recover) and has resources and desire to be market-maker.

Bidding is confined to the 15-16 registered bidders who have signed agreements with Treasury.

There are no other participants

A$1 million, increments of A$1 million.

No other requirements of dealers.

During auction, GEMMs must achieve rolling allocations commensurate with secondary market share and minimum of 2.5 per cent

GEMMs must
-make secondary market
-provide information to DMO about market conditions, positions and turnover, and provide quotes
-only ones who can bid directly
-only ones who can bid non-competitively
-invitation to quarterly consultation meeting with DMO regarding gilts to be scheduled for auction in following quarter

Federal Reserve sets minimum standards in a variety of areas. Guidelines are intentionally vague (benchmarks rather than absolute levels).

Expected to “participate meaningfully”, submit auction bids approx commensurate with the dealer’s capacity.

Should average 1 per cent of market making activity with customers, excluding inter-dealer activity.

Expected to make markets in govt securities; facilitate the Fed’s open market operations; provide Fed with information to assist the Fed in performing its duties.

No minimum bidding requirements, but SVTs ranked by detailed criteria measuring primary market share, secondary market share weighted by maturity (including repo and strips) and qualitative factors re relationship with AFT.

Ranking is used to select syndicate for some issues.

Must “materially” participate in every auction: minimum 12-month rolling average 2 per cent of competitive allotments, average across BTANs, OATs and BTF at least 2.5 per cent.[1]

Other dealers

For all government securities distributors

Must not bid in concert with others.

Must have “adequate” domestic fixed income trading past 6 months resident in Canada.

Must submit weekly reports on trading activities.

Not applicable No requirements, bid through GEMMs None None
Customers None Not applicable No requirements, bid through GEMMs None None

Bid Submission

Timing for
competitive bids


12:00 on day of auction

Bills: 10:30am on day of auction

15 minute window from 10:15 to 10:30

can change or withdraw bids within window

by 10:30am for gilts and 11:00am for bills competitive bids by 13:00 (usually) 10 minutes before deadline
Timing for
non-competitive bids


12:00 on day of auction

Bills: 10:30am on day of auction

not applicable by 10:30am for gilts; no non-competitive bids for bills (or mini-tenders) non-competitive bids by 12:00 (usually)  
Type of system Proprietary system (CARS) Changed from Bloomberg to internet-based in March 2009 Bloomberg (since 2007) for gilts; Telephone system for bills (moving to electronic system later in 2009) Proprietary system (TAAPS) Regular bidders use TELSAT. Occasional bidders use SWIFT. Submitted to Banque de France.
How are bids
multiple bid, grid)
Yields to 3 decimal places. Up to seven bids. Yields to 2 decimal places for notes and 3 decimal places (multiples of ½ bp) for bonds. Price basis for gilts one penny per £100 (i.e. 2 decimal places); yield basis to 3 decimal places for bills. On a yield basis; 3 decimal places for notes and bonds; 3 decimal places for bills (multiples of ½ bp).

OATs and BTANS: Excluding accrued interest price as percentage of par with two decimals.

BTF: money market straight line yield include accrued interest to 3 decimals (ticks of .5c)

None None None None None

-Primary Dealers: 10-25 per cent for own account (net of long position). 40 per cent total for own account + customers
-Other distributors:
0 to 9 per cent (10 per cent for customers)
-Customers: 25 per cent

Treasury bills: Primary dealers: 25 per cent for own account (net of long position) and 25 per cent for customers with total of 40 per cent for own + customer.
Other Government Securities Distributors: 0 or 10 per cent for own (net of long position); 10 per cent for customers.
-Government Securities Distributors own account maximum C$3M.
-Customers - C$5M (C$3M for RRBs).
-Sum of customers (per government securities distributor) C$3M for RRB and C$10M for nominal bonds and treasury bills.

No maximum on bidding.

A$1 million, increments of A$1 million

A$2 billion limit on any single bid.

Maximum 25 per cent of issue, net long allocation, for conventional gilts

40 per cent for index-linked gilts

No limit for bills

Maximum bid/position is 35 per cent of offering

BTAN and fixed rate OAT: €600 million

Floating rate OAT: €300 million

BTF: €1 billion (does not apply to cash management issues)

Government Right
to Reject Bids


Minister of Finance reserves the right to accept or reject any or all bids, in whole or in part, including without limitation the right to accept less than the total amount specified in the final call for tenders.

Yes; no bids have been rejected.


The DMO may, at its own discretion, decline to allot some or all of the stock bid for to an individual institution, particularly if it is deemed likely that a large allocation may lead to post-auction market distortion.

Yes; no bids have been rejected.


To keep the issued amount within the announced range, Agency France Trésor reserves the right to scale down bids at the lowest accepted price (OATs and BTANs) or rate (BTFs) on a pro rata basis.

Auction Results
Timing of release
relative to auction
Within 5 minutes, usually 2 minutes Within seconds - more or less automatic

Gilts: within 20 minutes; aim for 10 minutes; typical is 6-8 minutes

Bills: target 20 minutes and look to publish within 15 minutes

Released in 2 minutes (+/- 30 seconds) Within 5 minutes
Bid cover Yes Yes. Australia also examines the weighted average yield of all bids, including un-allotted, compared to the weighted average of winning bids. When these values are close, the coverage ratio is more meaningful. Yes. UK had failed auctions in March 2009 (.93 cover for £1.75 billion 40-year gilt), Sep 2002 (Bid/cover .95 for £900 million 30-year gilt) and 1999 on £500 million 30-year auction. Yes Yes
of winning bids
(multiple price
reports average,
single price
reports median)
Yes Yes Yes for bills
No – only cutoff bid for gilts
Yes Yes
Post-auction option
to purchase additional securities
None None As of June 2009, any winning bidder has right to purchase 10 per cent of bonds at published average price. Open 12 to 2pm. Bidders exercise when in the money. GEMM can use customer allotment. Adds to outstanding amount of issue. No option if auction not covered. None Post auction option available over 2 days.
Other comments Bank of Canada purchases are announced as part of auction results. Public announcement is more limited than what bidder sees. Competitive and non-competitive auction allocations are not distinguished in Press Notice with gilt auction results.

Bidders receive no more information than public.

Fed purchases are part of auction results.

Auction grid – volume and quantity, marginal price/rate.

Percent allocation at limit price.

Amount issued is announced within specified range. Published through TELSAT and news services.

Time to Settlement

T+3 for most bonds and RRBs

T+2 for 2-year bonds and bills

Bonds: T+3
Notes: T+1

T+1 for gilts and bills

Notes/Bonds/TIPs: settlement varies from T+1 to T+6. Settlement (issue) is on a particular day of the month, so settlement time depends on auction date relative to issue date.

13/26 week: T+3
4/52 week: T+2

T+3 for all auctions
(vs. T+1 secondary for BTANs)

CDSX Austraclear system CREST FICC Euroclear France’s Relit Grande Vitesse (RGV) system.
none perceived none perceived none perceived none perceived none perceived
Aftermath / Error
System rejects bids that are beyond plausibility range.

AOFM can view bids and chat with dealers in real time.

1/2 bp + increments of A$1 million – system will not accept bids that do not match these parameters

Plausibility limits – 10 bp range with warning message issued.

No longer do double check beyond system.

Bidder can contact DMO if notice bid input error.

Computer will catch some errors.

If bid appears out of line, supervisor contacts bidder before close.

Settlement managed by Treasury Central Accounting Agency (ACCT).
Monitoring and
Frequency of
formal consultation

Annual with dealers and customers. Topics vary, and include feedback on issue size, frequency, liquidity.

Report published based on consultations.

None. Quarterly with GEMMs includes discussion of maturity of gilts to be auctioned Quarterly consultation with market participants, including questionnaires to all Primary Dealers, interviews with half of the Primary Dealers, and discussions with an advisory committee of representatives of firms that trade and invest in Treasury securities. Questionnaire asks for estimates of the government’s borrowing needs and estimates of future issue sizes; seeks suggestions on maturity structure for conventional and index-linked securities; and asks about current market conditions and impact on related markets.

Weekly prior to each BTF auction, teleconf or meeting.
Weeks preceding each BTAN and OAT auction, in person meeting at AFT, or exceptionally teleconference.

Semi-annual meeting of SVTs (sales, trading, origination) to assess market developments. May include investors and Ministry or Banque de France.

SVTs must share research with AFT.
AFT informs SVTs of topics that require specific support. SVT MUST have economist based in Paris who regularly visits AFT.

Informal consultation Ongoing. Regular calls with primary dealers and customers prior to each auction. Ongoing informal dialogue with market participants. Typically speak to each dealer that submits bids in auctions at least once a week. This dialogue assists the AOMF in deciding which securities to issue the following week.  

Continuous communication with major participants

”Frequent, ongoing and efficient – market knows what to expect”. Predictability is important.

“Close continuing relationship”. Presence in France is important (must have a branch in France if not an investment service provider in France). SVTs are expected to keep AFT informed of decisions concerning multilateral trading systems in which they participate. SVTs contribute daily to informing AFT of market developments, trading volume, and when relevant, nature of customers and their own positions.
Other comments Periodic external reviews.     Solicitation of comment when rule changes are proposed. Regular opinion surveys jointly by AFT and SVTs with investors. Strategic committee of AFT meets twice per year.

1 In France, the Primary dealers’ status is viewed as a cross-subsidy in multi-pronged commercial relationship with the State which includes IPOs of state-owned firms or securitisation and as signal to end-investors that primary dealers has good information on market flows.