Philippines raises €750 million debt from Euro bond issue
MANILA, Philippines — The Philippine government said Friday it managed to raise €750 million (P44 billion) of debt from the sale of eight-year Euro-denominated bonds, which marked the Southeast Asian nation’s return to the European capital markets after more than a decade.
In a statement, the Bureau of the Treasury said “overwhelming” demand allowed the pricing for the Euro bonds to tighten at EUR Midswaps +70 bps.
“The Republic garnered outstanding support from high quality accounts with a large orderbook allowing us to increase our base offering size from €500 million to €750 million,” National Treasurer Rosalia de Leon said.
“The successful transaction allowed us to diversify our funding program to support productive spending for infrastructure and social services,” De Leon added.
By geographical allocation, 24% of the bonds were allocated to Germany, 15% to Italy, 10% to the U.K., 26% to the rest of Europe, 9% to the U.S., 6% to the Philippines, 5% to the rest of Asia and the remaining 5% to other countries, the BTr said.
In terms of investor type, 59% went to fund managers, 24% went to banks and corporates, 11% went to insurance, pension funds and official institutions, and the remaining 6% went to other types of investors.
Deutsche Bank and UBS acted as joint global coordinators, while BNP Paribas, Credit Suisse, and Standard Chartered Bank acted as joint bookrunners for the transaction.
Proceeds from the bond float will be used to provide budgetary support for the Philippine government, which has embarked on an ambitious infrastructure program.
International debt watcher S&P Global Ratings last month raised the Philippines’ credit rating from “BBB” to “BBB+” with a “stable” outlook.
Credit ratings reflect the ability of a country to manage and pay back its debt. S&P’s upgrade indicates that the Philippine government has further improved on its ability to pay back its long-term debt. — Ian Nicolas Cigaral
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