Daiwa Securities Group Inc., Japan’s second largest investment bank, expressed interest to fund the Duterte administration’s ‘Build, Build, Build’ infrastructure program and continue its support for the Philippines’ yen-denominated bond issuances in the Japanese market, the Finance Department said Wednesday.
Top executives of Daiwa Securities led by chairman Takashi Hibino said in a meeting with Finance Secretary Carlos Dominguez III that the bank “could be of help in terms of financing” to further accelerate infrastructure investments in the second half of President Duterte’s administration.
Hibino told Dominguez that Daiwa “is ready” for the Philippines’ next Samurai bond float and advised the government to issue such bonds at least once a year”•even in modest amounts”•to reach more investors.
Dominguez thanked Daiwa for its “invaluable” assistance that led to the Philippines’ successful return to the Japanese market in August with its Samurai bonds after an eight-year absence.
The Philippines’ multi-tranche issue was the largest Samurai transaction in Asia at JPY 154.2 billion.
The three-year tranche was priced 25 basis points above the benchmark, the 5-year at 35bps and the 10-year tranche at 60bps. It was the first time in almost 20 years that the government issued Samurai bonds on a stand-alone basis.
Dominguez told the Daiwa executives the Philippine government was looking forward to its partnership with Daiwa in future offshore transactions.
He said the Duterte administration would further scale up its infrastructure program to continue stimulating the economy amid global uncertainties triggered by the escalating US-China trade tensions and the Federal Reserve’s move to normalize monetary policy through successive interest rate increases.
Dominguez said the biggest high-impact infrastructure project that the Duterte administration was determined to implement”•the Philippines’ first-ever subway”•is being funded by Japan.
“It is more important for us now to continue stimulating the economy by doing the infra program. That is our countercyclical approach,” Dominguez told Daiwa officials during the meeting.
“We will be tapping the international markets for bond financing so it’s a perfect fit and we hope your organization can continue supporting us,” he said.
