SEC sees capital market making strong recovery from pandemic

Despite the turbulence caused by the black swan of 2020, the coronavirus di­sease (COVID-19) pandemic, the Securities and Exchange Commission (SEC) sees a good pipeline of fundraising deals by corporate Philippines attracting the investing public.

“We are optimistic that the Philippine capital market will make a strong recovery from the impact of the COVID-19 pandemic,” SEC Chair Emilio Aquino said in a press statement.

“We take the success of recent fundraising activities as one indication of the investing public’s continued confidence in the strength and resilience of our corporate sector, capital market and economy as a whole, especially with the reinforcements coming from the government,” he said.

Aboitiz Power Corp. intends to proceed with the issuance of the fourth tranche of its P30 billion worth of fixed-rate bonds under shelf registration with the SEC. The power gene­ration and distribution company plans to issue P9.55 billion worth of fixed-rate retail bonds within the quarter or the next.

Other companies have recently completed their public offerings, as the country entered a state of public health emergency with the confirmation of the first local transmission of COVID-19 on March 7.

Bank of the Philippine Islands announced on March 27 the issuance of P33.9 billion worth of bonds, with a tenor of 1.5 years and an interest rate of 4.05 percent per annum. Strong investor demand allowed the bank to upsize its P5 billion base offer by more than six times and end the offer period 11 days ahead of the March 17 schedule.

SM Prime Holdings Inc. also issued bonds worth P15 billion on March 25. The public offe­ring, which ran from March 2 to 13, comprised five- and se­ven-year bonds paying 4.8643 percent and 5.0583 percent in annual interest, respectively.

In the meantime, a bond offering by Rizal Commercial Banking Corp. was oversubs­cribed by twice the base offer after running for only three days and closing ahead of its March 27 schedule. The bank raised P7.05 billion from the issuance and listing of two-year bonds carr­ying a coupon of 4.848 percent per annum last April 7. The bonds form part of the bank’s P100-billion bond and commercial paper program.

“COVID-19 has killed thousands, disrupted businesses and livelihoods, and slowed down economies,” Aquino noted. “In these trying times, ensuring that the capital market continues to operate efficiently and reliably becomes as crucial as ever.”

Aquino said the SEC would continue monitoring developments in the capital market and remain proactive in supporting trading participants, issuers and investors in seeing through the uncertainties brought about by the COVID-19 pandemic. INQ