DBP prepares for new bond float in 2026

The Development Bank of the Philippines (DBP) is preparing for a bond sale amid signals from the Bangko Sentral ng Pilipinas (BSP) that interest rates could be cut further next year, lowering borrowing costs for development projects.

Carel Halog, DBP executive vice president and head of treasury, said the bond issuance could take place in the third quarter of 2026.

Halog added that they intend to raise fresh funds not lower than P10 billion and likely lower than P50 billion.

The bank is also weighing whether to issue sustainability-linked bonds, which require certification that proceeds are allocated to environmentally or socially beneficial projects. Halog noted, however, that such bonds involve extra costs and procedures.

“If we want to make it cost-efficient, we can just go with a straightforward fund,” he said.

Halog said the upcoming bond would likely be medium-term, with a tenor of around five years, depending on investor demand.

“As a borrower, you want to extend duration and lock in low rates while they are still low. Investors, however, prefer shorter terms. The final duration is a balance between supply and demand,” he said.

Halog noted that if the BSP cuts policy rates in December, it might not cut again in the first quarter of 2026, as the central bank would likely wait for the next inflation and growth figures.

Meanwhile, DBP president and CEO Michael de Jesus said he is “cautiously optimistic” about the country’s economic growth next year, projecting a rate of around 4 to 5 percent.

“At least for DBP, our outlook is good. But for the economy as a whole, it depends on investor confidence,” he said.

“I think the government is doing everything it can to restore that confidence.” INQ