Philippines issues 154.2 billion yen worth of Samurai bonds

August 8, 2018

The Philippines returned to the public Samurai market, with a multi-tranche 154.2 billion yen transaction, the Department of Finance (DOF) said Wednesday.

Three-year bonds drew 107.2 billon yen, five-year bonds 6.2 billion yen and ten-year bonds 40.8 billion, the DOF said.

The offering marks the return of the Philippines to the Samurai market after an 8-year break, and the first time in almost 20 years that it has issued Samurai bonds on a stand-alone basis.

"This successful return to the Samurai bond market is the latest proof of the deepening investor confidence in the Philippine economy under the Duterte presidency," Finance Secretary Carlos Dominguez III said.

"The government's disciplined fiscal position, along with game-changing reforms starting with the new legislation--the Tax Reform for Acceleration and Inclusion (TRAIN) Law--that has modernized and simplified Philippine taxation, have created enough room for our current policy of aggressive investments not only in public infrastructure but in human capital formation as well."

"Such priority programs are meant to sustain the country's momentum as one of Asia's fastest-growing economies, further improve its global competitiveness and bring lasting social benefits to all Filipinos in keeping with President Duterte's vision for high growth and financial inclusion," he added.

"And the strong response to this Samurai float, following a similarly successful offering of Panda bonds in China, underscores the international business community's increasing interest in investing in the Philippine growth story," he added.

Wednesday's offering was well received by a good mix of institutional and regional investors – most of whom are new to Philippine credit. These included [asset managers, life insurers, trust banks and specialist banks, regional accounts including shinkin banks, non-Japanese accounts and corporates].

National Treasurer Rosalia De Leon said: “This year has been a trailblazing year for the Republic in the international capital markets. In March we issued our debut Panda Bond to tremendous investor endorsement. And with today’s Samurai offering, we continue to expand and diversify our market access."

"The Republic has a track record of very tight pricing in US Dollar markets, and we will be uncompromising in measuring against that benchmark in approaching new markets," she added.  "Pricing on today’s offering is very compelling and we were able to print the maximum deal size we were seeking”.

Daiwa Securities Co. Ltd., Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., Mizuho Securities Co., Ltd., Nomura Securities Co., Ltd., and SMBC Nikko Securities Inc. acted as Joint Lead Managers and Book Runners for the issuance of the placement. DMS