NextGen Day

The sale of 5.5-year, 10.5-year, and 25-year US dollar-denominated global bonds by the Philippines on Tuesday raised a total of USD3 billion; the 25-year bond, which was a part of the Sustainable Finance Framework, was the largest sale by the government to date.

Following the USD2 billion triple tranche bond sale in October 2022, this is the second international bond offering made during the Marcos administration.

The JPY70.1 billion four-tranche Samurai bond in April 2022, the USD2.25 billion triple-tranche bond offering in March last year, and the 25-year sustainable bond offering are the previous three environmental, social, and governance (ESG) bond offerings.

The rate of the new 5.5-year and 10.5-year debt papers, with coupons of 4.625 percent and 5 percent, respectively, was priced at 105 basis points (bps) and 145 bps above equal tenor US Treasuries.

The coupon rates are 50 basis points closer to the 155 and 195 bps areas of the first pricing forecast, respectively.

The 25-year Sustainability bond, on the other hand, was valued at 5.50 percent at par, 45 basis points closer than the initial price forecast range of 5.95 percent.

On January 17, the administration is anticipated to settle the issue.

The government’s inaugural bond sale this year, according to Finance Secretary Benjamin Diokno, “represents a solid vote of confidence by international investors.”

It is evidence of the Republic’s strong economic fundamentals and of our economy’s adaptability to the choppy international financial markets, he said.

We are glad to see that foreign investors recognize the Philippines’ solid economic recovery, good fiscal policies, and pragmatic social agenda to foster sustainable and inclusive economic growth, according to Diokno.

“The blockbuster reception and tight pricing achieved in all tranches of our latest offering, despite coming on the heels of curtain-raisers done by other big-name sovereigns, reaffirms the distinction of Philippine credit as a preferred proposition even in times of uncertainties in the market landscape,” said National Treasurer Rosalia de Leon.

It is both a compliment for how well we handled the pandemic catastrophe and a spur to keep moving forward amid dimming global prospects, she continued.

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