Philippines raises ¥92 B from samurai bonds

MANILA, Philippines — The Philippines successfully returned to the Japanese debt market, raising $855 million (¥92 billion) in fresh funds from the issuance of samurai bonds with multiple tenors, the Bureau of the Treasury (BTr) reported yesterday.

In a text message, National Treasurer Rosalia De Leon said the Philippines successfully sold $855 million worth of three, five, seven and 10-year yen denominated bonds during its four-day offering in the Japanese onshore market.

“(We were able to raise) ¥92 billion or $855 million, tenors of three, five, seven and 10 years,” De Leon said.

De Leon said the BTr initially planned to cap the securities at $750 million, but decided to upsize the offering after the order book reached more than ¥100 billion.

She said this is to show appreciation to the demand shown by those who participated in the offering.

De Leon confirmed that ¥30.4 billion of the total awarded volume came in the form of three-year samurai bonds, ¥21 billion in five-year debt papers, ¥17.9 billion in five year securities, and ¥22.7 billion in 10-year debt notes.

The securities were priced at a coupon rate of 0.18 percent, 0.28 percent, 0.43 percent, and 0.59 percent, respectively.

The government borrows from both local and foreign creditors to finance its budget deficit, which is capped at 3.2 percent of gross domestic product (GDP) this year.

Last year, the government also tapped the Japanese market, raising ¥107.2 billion from the issuance of samurai bonds with maturities of three, five and 10 years.

Aside from the issuance of the yen-denominated bonds, the Treasury earlier this year also issued US dollar denominated global bonds, panda bonds, and euro bonds.

Last January, the government raised $1.5 billion from the issuance of dollar-denominated global bonds, which fetched an all-in yield of 3.75 percent, 110 basis points higher than the US Treasury rates.

The Philippines also returned to the European debt market in early May, raising 750 million euros from the issuance of eight-year global bonds. The debt papers were priced at a coupon rate of 0.875 percent, 70 basis points over benchmark.