PH starts 2019 with $1.5-B borrowing

By: - Reporter / @daxinq
/ 05:10 AM January 09, 2019

In what has become an international financial market habit early in the new year, the Philippine government on Wednesday successfully borrowed $1.5 billion from foreign creditors by issuing a new batch of bonds maturing in 10 years, the Department of Finance said.

Finance Secretary Carlos Dominguez III said the deal “further illustrates deepening investor confidence in the Philippines’ growth story and the Duterte administration’s ability to maintain fiscal discipline while spending big on infrastructure modernization, human capital development and social protection for the poor.”


The global bonds were priced at 110 basis points over equivalent US treasury yields after an initial expectation of pricing at around 130 basis points over the benchmark. The bonds are expected to be rated Baa2 by Moody’s, BBB by Standard & Poor’s and BBB by Fitch.

Capitalizing on the recent positive market trading tone after the strong US employment data released on Friday, the government announced the issuance last Jan. 7.


Like in previous years, the issue marked the first emerging market sovereign US dollar bond sale for the year and “demonstrates the [government’s] ability to respond tactically to conducive market conditions to capture a favorable issuance window,” the Finance Department said.

By geographical allocation, 37 percent of the bonds were allocated to Asia, 28 percent to the US and 35 percent to Europe. In terms of investor type, 52 percent went to asset managers, 22 percent to banks, 14 percent to sovereign wealth funds, pension funds, and insurance, and the remaining 12 percent to private banks and other types of investors.

“We have garnered strong support from the global fixed-income investor community despite recently heightened volatilities in the global markets,” National Treasurer Rosalia de Leon said. “This demonstrates strong conviction from the global investor community on the Republic’s economic fundamentals as well as the depth of the Republic’s investor outreach.”

Bank of China, JP Morgan and Standard Chartered Bank acted as joint global coordinators for the transaction, while Citigroup, Credit Suisse, Goldman Sachs (Asia) L.L.C. and UBS acted as joint bookrunners for the transaction.

Read Next
Don't miss out on the latest news and information.
View comments

Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.

TAGS: $1.5-B borrowing, Department of Finance, Finance Secretary Carlos Dominguez III, Foreign creditors
For feedback, complaints, or inquiries, contact us.

© Copyright 1997-2020 INQUIRER.net | All Rights Reserved

We use cookies to ensure you get the best experience on our website. By continuing, you are agreeing to our use of cookies. To find out more, please click this link.