Corporate bond issuances doubled in 4 years

Fund-raising among Philippine corporations through bond issuance more than doubled to P1.48 trillion over four years into the Duterte administration, the Department of Finance (DOF) said on Wednesday.

Citing a report of Philippine Dealing and Exchange Corp. (PDEx) to the Capital Market Development Council (CMDC) cochaired by Finance Secretary Carlos Dominguez III, the DOF said corporate bond issuances as of end-August jumped from P645.6 billion in 2016.

The DOF quoted PDEx presi­dent and chief operating officer Antonino Nakpil as saying that the climb in the amount of listed private debt securities meant there was an “active primary market dominated by financial institutions.”

Nakpil said the outstanding private sector-listed bonds steadily increased to P792.5 billion in 2017, P1.05 trillion in 2018 and P1.32 trillion last year.

“The primary market has been very active … We actually hit P1.53 trillion but there were some maturities and the outstanding level as of the end of August was at P1.48 trillion,” Nakpil said.

Nakpil noted that the amount of listed corporate bonds had been gradually rising since 2008.

“From 2018, the financial sector has led the activity and at present, financials now account for 43 percent of total corporate bonds listed. This is followed by the property market (24 percent), holding firms (15 percent), the industrial market (13 percent) and consumer staples (2 percent),” Nakpil added.

“In terms of new corporate bond listings, a total of P136.5 billion worth of bonds were issued in 2016, which grew to P207.4 billion in 2017, P256.4 billion in 2018, and reached a record-high P375.6 billion in 2019. As of August this year we are at P295 billion so it is still quite positive although for this particular period what is active are the one- to three-year short tenors,” according to Nakpil. INQ