Philippines launches new long-term U.S. dollar bonds issue

MANILA - The Philippine government launched an offering of 10.5-year and 25-year U.S. dollar-denominated bonds on Wednesday to raise funds needed to mitigate the economic damage of the coronavirus pandemic.

The long-term benchmark bonds would carry a yield of around 100 basis points above the 10-year U.S. Treasury benchmark, based on the government's initial guidance.

National Treasurer Rosalia De Leon could not say at this stage how much the government aimed to raise from the bond sale, which follows a similar U.S. dollar bond offering in April that raised $2.35 billion. 

The Philippines, one of Asia's most active issuers of sovereign debt, would use the proceeds from the bond sale to support its budget, the Bureau of the Treasury said.

Both chambers of congress have approved a record 4.5 trillion pesos ($93.7 billion) budget for 2021, part of which will be used to purchase COVID-19 vaccines as the government aims to immunize a third of its 108 million population.

Credit Suisse, Daiwa Capital Markets, Deutsche Bank, Morgan Stanley, Standard Chartered Bank and UBS are joint bookrunners, IFR reported. 

Fitch assigned a 'BBB' rating to the country's proposed USD bonds, while Moody's gave the Philippines' global dual-tranche bond offerings a 'Baa2' rating.

-reuters-

PHL starts selling 25-yr. US dollar bonds

The Philippines on Wednesday started selling 25-year US dollar bonds to finance its infrastructure projects this year.

According to Finance Undersecretary Rosalia de Leon, the offering is of “benchmark size.”

National Treasurer Roberto Tan said Tuesday government intends to sell $500 million to $1.5 billion in global bonds.

The Aquino administration needs to spend P500 million for infrastructure development to achieve a 5-percent to 6-percent economic growth this year, said former Budget Secretary Benjamin Diokno

Hired to sell the bonds were Citigroup Inc., Credit Suisse Group AG, Deutsche
Bank AG, Goldman Sachs Group Inc., HSBC, JP Morgan Chase, Standard
Chartered Plc. and UBS AG, according to a Department of Finance statement Wednesday.

Government emphasized in a presentation released by Bangko Sentral ng Pilipinas Investor Relations Office that the Philippines has a strong points as a global bond issuer, including “a strong domestic consumer base, effective monetary policy, strong external payments position, prudent fiscal management,
stable banking system and a reform minded administration.”

In an emailed statement Wednesday, Fitch Ratings noted it “has assigned the Republic of the Philippines' upcoming USD-denominated global bonds due 2037 an expected 'BB+' rating.”

“The final rating is contingent on the receipt of final documentation conforming to information already received,” Fitch added. — VS, GMA News

source:gmanetwork.com