By Rosemarie Francisco
MANILA, Sept 29 (Reuters) - The Philippines on Wednesday issued $3.19 billion of new 2021 U.S. dollar bonds and reopened 2034 U.S. dollar bonds in a swap and sale aimed at stretching its debt profile.
Asia's largest sovereign issuer of foreign debt is taking advantage of strong investor appetite for emerging markets. The issue comes less than three weeks after it raised $1 billion from the region's first global debt sale in local currency. For details, see
Investors tendered $4.45 billion worth of shorter-dated maturities for the longer-dated issues, the Philippines government said in a statement.
Finance Minister Cesar Purisima cited the exchange as 'another achievement' in its plans to manage the government's financial liabilities, the statement said.
The Philippines sold approximately $2.24 billion worth of the 2021 bond at an issue price of 99.248, bringing a yield of 4.091 percent and coupon of 4.0 percent.
The government paid, as expected, 155 basis points over mid-swaps for the 2021 issue. Mid-swaps is a measure of interest between fixed and floating rates.
The government sold outright and additional $200 million of the 2021 bonds. That new cash can go toward funding a budget deficit that is on course to hit 3.9 percent of GDP this year, or 325 billion pesos ($7.4 billion), a record in peso terms.
According to the statement, the cash offering of new 2021 bonds were almost 10 times oversubscribed.
The reopening of the 2034 bonds did not bring any new cash, but the exchange adds approximately $1 billion to the existing $1.85 billion outstanding.
The issue price was 114.879. The yield of 5.276 percent, as expected, was 160 basis points over 30-year U.S. Treasuries. The coupon is 6.375 percent.
Citigroup, HSBC and UBS are joint deal managers.
Manila had earlier said it could issue up to a total of $3 billion of bonds under the debt swap, as approved by the central bank. It said the minimum offering for the 2021 bonds would be $500 million, with no minimum size for the reopened 2034 bonds.
Apart from the global bond exchange, the government also wants to launch a local bond swap offer before the end of the year as part of its liability management. The country's last domestic debt swap was in January 2009.
At the end of June, Manila owed about a quarter of its $104 billion outstanding debt to foreign bondholders and more than half to domestic bondholders.
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((Additional reporting by Daniel Bases in New York, Editing by Gary Crosse)) Keywords: PHILIPPINES ECONOMY/SWAP (rosemarie.francisco@thomsonreuters.com; +63-2-841-8937; Reuters Messaging: rosemarie.francisco.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
MANILA, Sept 29 (Reuters) - The Philippines on Wednesday issued $3.19 billion of new 2021 U.S. dollar bonds and reopened 2034 U.S. dollar bonds in a swap and sale aimed at stretching its debt profile.
Asia's largest sovereign issuer of foreign debt is taking advantage of strong investor appetite for emerging markets. The issue comes less than three weeks after it raised $1 billion from the region's first global debt sale in local currency. For details, see
Investors tendered $4.45 billion worth of shorter-dated maturities for the longer-dated issues, the Philippines government said in a statement.
Finance Minister Cesar Purisima cited the exchange as 'another achievement' in its plans to manage the government's financial liabilities, the statement said.
The Philippines sold approximately $2.24 billion worth of the 2021 bond at an issue price of 99.248, bringing a yield of 4.091 percent and coupon of 4.0 percent.
The government paid, as expected, 155 basis points over mid-swaps for the 2021 issue. Mid-swaps is a measure of interest between fixed and floating rates.
The government sold outright and additional $200 million of the 2021 bonds. That new cash can go toward funding a budget deficit that is on course to hit 3.9 percent of GDP this year, or 325 billion pesos ($7.4 billion), a record in peso terms.
According to the statement, the cash offering of new 2021 bonds were almost 10 times oversubscribed.
The reopening of the 2034 bonds did not bring any new cash, but the exchange adds approximately $1 billion to the existing $1.85 billion outstanding.
The issue price was 114.879. The yield of 5.276 percent, as expected, was 160 basis points over 30-year U.S. Treasuries. The coupon is 6.375 percent.
Citigroup, HSBC and UBS are joint deal managers.
Manila had earlier said it could issue up to a total of $3 billion of bonds under the debt swap, as approved by the central bank. It said the minimum offering for the 2021 bonds would be $500 million, with no minimum size for the reopened 2034 bonds.
Apart from the global bond exchange, the government also wants to launch a local bond swap offer before the end of the year as part of its liability management. The country's last domestic debt swap was in January 2009.
At the end of June, Manila owed about a quarter of its $104 billion outstanding debt to foreign bondholders and more than half to domestic bondholders.
((If you have a query or comment on this story, send an e-mail to: news.feedback.asia@thomsonreuters.com))
((Additional reporting by Daniel Bases in New York, Editing by Gary Crosse)) Keywords: PHILIPPINES ECONOMY/SWAP (rosemarie.francisco@thomsonreuters.com; +63-2-841-8937; Reuters Messaging: rosemarie.francisco.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.