The Philippines raised $3.29 billion from the sale of the United States dollar and euro-denominated bonds, the Bureau of the Treasury (BTr) announced on Friday.
In a statement, the BTr said the offering comprised $2.25 billion from 10-year and 25-year U dollar bonds and €1 billion ($1.04 billion) from a 7-year euro bond.
The 25-year dollar bond and 7-year euro bond would be issued under the Sustainable Finance Framework.
“This marks the Republic’s first ever EUR sustainability bond and also marks the Republic’s return to EUR bond markets since April 2021,” the BTr said.
The US Dollar 10-year bond was priced at T+90 basis points, tightening 30 basis points from its initial price guidance (IPG) of T+120 basis points, while the US Dollar 25-year sustainability bond was set at 5.9 percent, down from the earlier estimate of around 6.1 percent.
The EUR 7-year sustainability bond was priced at mid-swaps plus 125 basis points, narrowing by 35 basis points from the IPG of mid-swaps plus 160 basis points.
"Despite the volatility in markets, the success of the offering demonstrated the Republic’s ability to efficiently capture conducive market conditions and launch a jumbo dual-currency transaction. The transaction had also attracted robust demand and the strong orderbook momentum carried across USD and EUR markets, with interest from a diverse pool of high-quality global accounts, showcasing investors’ confidence in the Republic’s credit profile and long-term outlook," the BTr said.
The BTr said the transaction is expected to settle on Feb. 4.
The dollar bonds have received positive ratings from leading credit agencies, with S&P Global Ratings assigning a "BBB+" to the dollar bonds and Fitch Ratings giving the dollar and euro bonds "BBB" (good credit quality) rating.
Proceeds will fund general budget requirements and projects aligned with the country's sustainability goals.
“With a constructive market developing over the week, we see an opportune window for the Republic to re-enter the capital markets. Our goal is to capitalize on the current market momentum to secure the most efficient cost dynamics ahead of potential uncertainties in the near future. We look forward to the continued support of our valued investors,” National Treasurer Sharon Almanza said.
Finance Secretary Ralph Recto said the successful offering reflects investor confidence in the country’s economic direction.
“The success of this offering underscores our ability to seize favorable market conditions efficiently. This is a reflection of the trust and confidence of investors in the leadership and policies of the Marcos Jr. administration, as recognized by the market and further reinforced by the country’s improving credit rating trajectory,” he said.
Recto further noted that the administration's commitment toward stronger investor dialogue is evident in the government's frequent investor engagements, especially during this year's World Economic Forum (WEF) in Switzerland.
"We have constantly communicated our strategies to achieve robust socioeconomic development for the country, and hence, we are confident that our investors will remain receptive to the Philippine growth story,” Recto said.
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