Gov’t raises $2.53 B from euro bond sale

The government has raised $2.53 billion (2.1 billion euro) from the successful issuance of euro-denominated bonds in three tranches, the Bureau of the Treasury (BTr) announced yesterday.

This was the second time the country returned to the international capital markets after its issuance of samurai bonds last month.

Sold were global bonds in tenors of four years (euro 650 million), 12 years (euro 650 million) and 20 years (euro 800 million), for a total issuance of euro 2.1 billion.

The new four-year bonds fetched a coupon of 0.250 percent while the new 12-year bonds obtained a coupon of 1.200 percent. Also, the new 20-year bonds fetched a coupon rate of 1.75 percent.

The BTr said this was the largest eurodenominated transaction by the government and the first triple-tranche offer. The 20-year bond was also the longest eurodenominated tenor and largest individual tranche issued by the country.

The transaction is expected to be settled on April 28.

Proceeds of the issuance will be used by the government for general purposes, including budgetary support.

BNP PARIBAS, Credit Suisse, Goldman Sachs, J.P. Morgan, Nomura, and Standard Chartered Bank acted as joint lead managers and joint bookrunners for the transaction.

“The Philippines’ successful return to the international capital market for the second time this year reflects the investor community’s confidence in the country’s prospects for a strong recovery from the prolonged pandemic,” said Finance Secretary Carlos Dominguez.

National Treasurer Rosalia de Leon said the successful issuance also indicates that investors are confident about the country’s long-term recovery prospects.

“The success of this euro deal, being already our fourth offering since the pandemic, serves as affirmation that we are on track to emerge from this crisis as a stronger and more resilient economy. Further, the ability to stretch our maturities to the 20-year tenor at tight pricing underscores that investors are, indeed, taking a long view on our return prospects,” she said.