Philippines raises $2 billion in return to international bond market

May 9, 2024 - 1:59 PM
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1000 cash
This undated file photo shows one thousand peso bills. (The STAR/Walter Bollozos/File Photo)

 The Philippines has raised $2 billion through a dual-tranche bond sale, with the offering attracting robust demand from offshore investors despite market volatility, the finance ministry said on Wednesday.

“The enthusiastic response we got saw from the global investor community for this offering underscores the strength of the Philippine economy,” Finance Secretary Ralph Recto said in a statement.

The international offering, which was the Philippines’ first this year, comprised of a conventional 10-year tranche, sold at 80 basis points above comparable U.S. Treasuries, and a 25-year sustainability tranche sold at par.

“We secured funding from the market at very cheap rates, which allowed us to save on borrowing costs,” Recto added.

Proceeds of the bond issue will be used for general budget financing and refinancing programs.

One of Asia’s most-active sovereign bond issuers, the Philippines in November raised $1 billion from its maiden sale of sukuk or Islamic bonds. It regularly taps local and foreign debt markets to help finance its budget deficit.

($1 = 57.3850 Philippine pesos)

— Reporting by Scott Murdoch in Sydney and Neil Jerome Morales in Manila; Editing by Christian Schmollinger, Martin Petty