The Philippines on Friday raised 92 billion yen (P44.3 billion) from the sale of Japanese samurai bonds in four different tenors.
The bulk or 30.4 billion yen (P14.6 billion) of the amount came in the form of three-year bonds, sold at a coupon rate of 0.18 percent.
The government also sold 21 billion yen (P10.1 billion) in five-year denominated bonds at a coupon rate of 0.28 percent and 17.9 billion yen (P8.6 billion) in seven-year yen-denominated bonds at a coupon rate of 0.43 percent
The Philippines sold 22.7 billion yen(P10.9 billion) in 10-year bonds at a coupon rate of 0.59 percent.
The Treasury department tapped Mizuho Banks Ltd., The Daiwa Bank Ltd., Mitsubishi UFJ Group, Nomura and Sumitomo Mitsui Banking Corp for the transaction.
In a statement, S&P Global Ratings assigned a ‘BBB+’ long-term foreign currency rating to the 92 billion Japanese samurai bonds issued by the Philippines (BBB+/Stable/A-2).
“The notes represent direct, general, unconditional, unsecured, and unsubordinated obligations of the sovereign, and rank equally with the sovereign’s other unsecured and unsubordinated debt obligations,” S&P said.
The Philippines in August last year sold ¥154.2 billion (P74.18 billion) worth of Japanese samurai bonds, the first time it returned to the Japanese bond market for in eight years.
Finance Secretary Carlos Dominguez III said last year’s three-year tranche were priced 25 basis points above the benchmark, tighter than that of the recent Panda bond issuance, which was 35 bps. The five-year tranche was priced at 35 bps, while the 10-year tranche was priced at 60 bps above the benchmark.
He said the coupon was set at 0.38 percent, 0.54 percent, and 0.99 percent for the three-, five-, and 10-year tranches, respectively.
“Overall, the transaction yielded a weighted average spread of 34.7 basis points above benchmark. Compared to our peers, the Republic priced tighter and issued more than Indonesia [JPY100 billion] and higher-rated Mexico [JPY135 billion],” Dominguez said.
The Bureau of the Treasury said the offering marked “the return of the Republic to the Samurai market after an eight-year break and the first time in almost 20 years that it has issued Samurai bonds on a stand-alone basis.”
Japan has been the Philippines’ major source of official development assistance and a reliable ally in terms of infrastructure support from the period of reconstruction, one of its top trading partners, and its fourth largest source of foreign tourists, Dominguez has said.