Philippines raises €2.1B from euro-denominated global bond sale

The Philippine government said Thursday it has successfully returned to the international capital markets for the second time this year, raising €2.1 billion from the issuance of euro-denominated global bonds to support the country’s budgetary requirements.

In a statement, National Treasurer Rosalia de Leon said the issuance comes after March’s ¥55-billion Samurai bond offering.

The latest offering consists of four-year, 12-year, and 20-year bonds.

The four-year bonds have a coupon rate of 0.250%, the 12-year bonds have a 1.200% coupon rate, while the 20-year bonds have a coupon rate of 1.750%.

Finance Undersecretary Mark Joven said, “The euro-denominated bond market has proven to be an attractive and sustainable funding source for the Republic on top of our usual Peso, Dollar, and Japanese Yen issuances.”

For her part, De Leon said that the success of the euro deal, “being already our fourth offering since the pandemic, serves as affirmation that we are on track to emerge from this crisis as a stronger and more resilient economy.”

“Further, the ability to stretch our maturities to the 20-year tenor at tight pricing underscores that investors are indeed taking a long view on our return prospects,” she said.

The transaction marks the largest euro-denominated transaction and the first triple-tranche euro-denominated offering from the Philippine government, according to the Bureau of the Treasury.

Proceeds of the issuance will be for “the Republic's general purposes, including budgetary support,” the Treasury said.

“The Philippines' successful return to the international capital market for the second time this year reflects the investor community's confidence in the country's prospects for a strong recovery from the prolonged pandemic, given that its financial readiness has allowed the government to do whatever COVID-19 response measures are necessary to save lives and revive the economy,” Finance Secretary Carlos Dominguez said.

"Investors apparently believe we have what it takes to ride out the COVID-19 crisis on the strength of the fiscal discipline that has been maintained and the tax measures plus other reforms that have been carried out by the government since President Duterte assumed office five years ago," Dominguez added.

BNP PARIBAS, Credit Suisse, Goldman Sachs, J.P. Morgan, Nomura, and Standard Chartered Bank acted as Joint Lead Managers and Joint Bookrunners for the transaction.—AOL, GMA News