SINGAPORE — The Philippines has raised $2.5 billion from a three-part U.S. dollar bond deal, according to a term sheet seen by Reuters early on Wednesday, against the backdrop of steadier global markets after a ceasefire in the Middle East helped ease investor concerns.
The deal adds to a run of Southeast Asian dollar bond sales, after an Indonesian sovereign wealth fund unit, Danantara Investment Management, raised $1.5 billion last week in its first dollar bond.
- The Philippines sold $550 million of 5.5-year bonds, $1.65 billion of 10-year bonds and a $300 million further issue of its existing 5.75% bonds due 2051, the term sheet showed.
- The 5.5-year bonds were launched at 55 basis points over U.S. Treasuries, while the 10-year bonds were launched at 92.5 basis points over Treasuries. A basis point is one hundredth of a percentage point.
- The final levels were tighter than initial price guidance of around 85 basis points and 125 basis points over Treasuries for the 5.5-year and 10-year bonds respectively.
- The further issue of the 2051 bond was launched at a yield of 5.85%, compared with initial guidance of around 6.10%. Yield is the return investors receive for holding the bond.
- The bonds are expected to settle on June 24.
- They are expected to be rated Baa2 by Moody’s, BBB+ by S&P and BBB by Fitch, in line with the sovereign’s ratings.
- The government will use the proceeds for general budget financing.
- BNP Paribas <BNPP.PA>, Citigroup C.N, HSBC HSBA.L, JPMorgan JPM.N, MUFG <8306.T> and Standard Chartered <STAN.L> are joint lead managers and bookrunners.
—Reporting by Yantoultra Ngui in Singapore; Editing by Christopher Cushing, Himani Sarkar, Chizu Nomiyama and Gareth Jones
