Warm reception for 2nd Panda Bonds issuance: BTr

The Republic of the Philippines has successfully issued its Renminbi-denominated Bonds (Panda Bonds) of RMB2.5 billion with a tenor of three years on Wednesday (May 15), the Bureau of the Treasury (BTr) announced in a statement on Thursday. This was the second Panda Bonds issuance for the Philippines, which issued its first Panda Bonds in March of 2018.

The bonds were priced at 3.58%, which allowed the Republic to achieve a tight spread of 32bps above the benchmark. The order book reached a total of more than RMB11 billion, reinforcing a strong vote of confidence in the Republic’s economic stewardship and transformative reform agenda.

In terms of geographical breakdown of investors, leveraging on the Bond Connect scheme, 42.4% of final allocation went to China’s onshore investors, and 57.6% went to overseas investors. Major investors include commercial banks from China’s onshore and offshore markets, the BTr further revealed.

China Lianhe Credit Rating Co. Ltd. rated both the Philippines and this issuance as AAA, its highest rating. Aside from the local AAA rating, the Philippines has an international rating of Baa2/ BBB+/BBB (Moody’s/ S&P/Fitch).

National Treasurer Rosalia de Leon said: “The success of our Panda bonds issuance, along with other recent issuances, resonates the positive market sentiment on Philippine credit. Through strategic and timely offerings, we are able to tap various markets even in a challenging environment that allowed for the Republic that resulted in more cost-efficient pricing.”