POSSIBLE EFFECT OF LOWERING MATURITIES OF TREASURY BILLS IN THE REPUBLIKA SRPSKA // MOGUĆI EFEKTI POTENCIJALNOG SMANJENJA ROKOVA DOSPIJEĆA TREZORSKIH ZAPISA U REPUBLICI SRPSKOJ

Abstract

Treasury bills as an instrument of fiscal policy are increasingly used to cover the budget deficit, as well as to maintain the current ratio. They can have a positive effect on the financial market, and therefore the economy if the public debt is efficiently managed. Republic of Srpska has started issuing treasury bills in mid-2011. Since then it has continuously increased the frequency and amount of the issue. The main question is how justified are these kind of borrowing, and the benefits of its cost. This paper wants to explore the trends of treasury bills in Republic of Srpska, limits of emissions, emission rates, as well as the interest rate on issued bills, all for the purpose of searching for cheap sources of budget financing. The basic hypothesis is: The shorter deadline emissions can significantly reduce the interest rate on treasury bills issued.
The results obtained confirm the hypothesis, which suggests that Republika Srpska could achieve significant savings in budget expenditures if it lowers current maturities of 12, 9, 6 and 3 months to the monthly level.
For the purposes of determining the conditions, dynamics and conditions of issuing treasury bills in the Republic of Srpska was used analysis method, and for the purposes of drawing the conclusions method of deduction will be used.