ADB debuts in offshore Philippine peso bond market

February 8, 2019

The Asian Development Bank (ADB) on Friday announced that it has raised P5.2204 billion ($100 million) from a new issue of local currency bonds in the international market.

ADB issued bonds in the Philippine domestic capital market in 2005 and 2007 but this is the first time it has mobilized Philippine peso funding from international investors through a currency-linked structure.

Currency-linked bonds are denominated in the local currency but settled in US dollars. The bonds pay a fixed interest rate of 5.25 percent and have a final maturity of four years.

The proceeds of the bonds will support ADB’s growing local currency operations in the Philippines and help to reduce foreign exchange risk for ADB’s borrowers.

“ADB is delighted to support the capital markets in the Philippines where ADB is based,” said ADB Treasurer Pierre Van Peteghem. “Our program to issue local currency bonds in ADB member countries has been very successful. We hope that the Philippines can become a cornerstone of this program moving forward.” DMS