THE Philippines successfully returned to the international capital markets with its offering of euro 750 million of eight-year global bonds.
The bonds are expected to be rated Baa2 by Moody’s, BBB+ by Standard & Poor’s, and BBB by Fitch, the Department of Finance said in a statement. The notes are expected to settle on May 17, 2019.
The issuance marks the Philippines’ return to the European capital markets after more than a decade.
By geographical allocation, 24 percent of the bonds were allocated to Germany, 15 percent to Italy, 10 percent to the UK, 26 percent to the rest of Europe, nine percent to the US, six percent to the Philippines, five percent to the rest of Asia, and the remaining five percent to other countries.
In terms of investor type, 59 percent went to fund managers, 24 percent went to banks and corporates, 11 percent went to insurance, pension funds, and official institutions, and the remaining six percent went to other types of investors.
Finance Secretary Carlos Dominguez III said: “This successful transaction is a testament to the international investor community’s vote of confidence in the country’s strong macroeconomic fundamentals and sustained high growth prospects despite global financial headwinds.”
Dominguez pointed out that following its successful float of bonds in China and Japan, the government has now issued global bonds in Europe as part of its efforts to diversify funding sources for its aggressive investments in infrastructure and human capital development.
Proceeds of the issuance will be used for the country’s general government purposes, including budgetary support.
National Treasurer Rosalia de Leon said: “The Philippines garnered outstanding support from high quality accounts with a large orderbook allowing us to increase our base offering size from euro 500 million to euro 750 million. The successful transaction allowed us to diversify our funding program to support productive spending for infrastructure and social services.”
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. (PR)