Primary of primary dealers in Bonos and Obligaciones

1. Participation in Treasury Auctions: Only Market Makers in Government Bonds may present requests in the thirty minutes before the closing of the period of the presentation of requests in each Government Bond auction.

2. Access to the second rounds: Market makers in Government Bonds may gain exclusive access to a second round of the Government Bonds auction, which will be carried out between  the end of the auction and 12:00 P.M of the previous day of the effective date (D+3).

A maximum of 24% of the nominal amount of each bond allocated at auction will be issued in this second phase.

All bids for Bonos y Obligaciones will be met at the rounded-up weighted average price arising from the auction phase.

The share of the second round that can be obtained by each market maker that qualifies will be equal to that market maker’s combined allotment in both the current auction and the previous auction of the similar bond.  If it is the first auction a bond, the share will be the combined allotment in the current auction and the latest auction of the closest benchmark.

The maximum percentage of the second round for each Market maker is divided into several tranches:

- The maximum percentage of the second round for each Market maker is divided into several tranches: A 24% of the nominal allotted in the auction, which the Treasury may distribute among the most active Market makers, according to the last evaluation periods previous to the auction and those Market makers that have also complied with the minimum quoting obligations during the last evaluation period previous to the auction.

- A 20% of the nominal allotted in the auction, which the Treasury may distribute among those Market makers that have complied with the minimum quoting obligations during the last evaluation period previous to the auction and that are not among the most active Market makers, according to the last evaluation periods previous to the auction.

- A 4% of the nominal allotted in the auction, among the most active Market makers, according to the last evaluation periods previous to the auction and that have not complied with the minimum quoting obligations during the last evaluation period previous to the auction.

- A 0%, to those Market makers which have not been among the most active market makers, according to the last evaluation periods previous to the auction and that have not complied with the minimum quoting obligations during the last evaluation period previous to the auction.


3. Stripping and reconstitution of Government Bond securities: the Market Makers in Government Bonds will be the only companies authorized to strip and reconstitute strippable Government Debt securities. 4. Other Debt management operations The status of Market Maker in Government Bonds will be valued in the selection of counterparties for other Debt management and allocation operations which may be carried out by the Treasury, such as syndicated issues in Euros, financial exchange transactions and foreign currency issues.

5. Reception of information about Treasury financing policy.

6. Participation, where applicable, in the setting of objectives for the issue of medium and long term Treasury debt instruments.

7. Representation on the Public Debt Market Advisory Commission, together with the Market Makers in Treasury Bills.