Philippines issues 10-year US dollar Global Bonds

January 8, 2019

The Philippines returned to the international capital markets by offering $1.5 billion of 10-year Global Bonds, the Bureau of the Treasury said Tuesday.

The bond issuance is the first sovereign US dollar bond issuance in 2019. Proceeds will be for the Philippines' general purposes, including budgetary support, the bureau said.

The bureau said the Philippines capitalized " on the recent positive markets trading tone post the strong US employment data on Friday' to announce the bond issue on Monday.

The bonds were priced at US Treasury spreads of T+ 110 basis points after an initial pricing guidance of T+130 basis points and an all-in yield of 3.75 percent. These are expected to be rated Baa2, BBB by Standard& Poor's and BBB by Fitch.

In a text message to the Daily Manila Shimbun, Assistant Finance Secretary Tony Lambino said ;"The issue  garnered strong demand as the order book peaked at $4 billion.''

National Treasurer Rosalia de Leon  said the issue ''garnered strong support from the global fixed income investor community despite recently heightened volatilities in the global markets.''

This demonstrates our strong conviction from the global investor community on the Republic's economic fundamentals as well as the depth of the Republic's investor outreach,'' added de Leon.

The notes, which will settle on January 14, were allocated to the following areas: 37 percent to Asia, 28 percent to the US and 35 percent to Europe.

''This transaction further illustrates deepening investor confidence in the Philippines' growth story and the Duterte administration's ability to maintain fiscal discipline while spending big on infrastructure modernization, human capital development and social protection for the poor." said Finance Secretary Carlos Dominguez III. DMS