The government and private companies prepaid $2.34 billion worth of medium- and long-term foreign debt in the first nine months of 2015, up 110 percent from $1.1 billion a year ago, to take advantage of low interest rates.
Data from Bangko Sentral ng Pilipinas showed the public sector, including the national and local governments and state-owned and –controlled corporations prepaid $1.467-billion loans in the January-September period, up from $953.7 million a year earlier.
Private companies settled $875.2 million in debt ahead of maturity, up from $159.7 million year-on-year.
Debt prepayments surged from a year ago, ahead of the interest rate increase by the US Federal Reserve.
Bangko Sentral kept interest rates unchanged last year, due to the low-inflation environment. The benchmark interest rates were kept at 4 percent for overnight borrowing and 6 percent for overnight lending.
Bangko Sentral urged both private and public companies to pre-pay their foreign-denominated financial obligations, especially when the peso was strong and interest rates were low.
Bangko Sentral earlier said the low-interest regime and strengthening of the peso against the dollar would help companies save money through the pre-termination of their foreign-denominated debt.
Loans and other obligations normally have provisions for prepayments where the borrower could save money by either pre-terminating or pre-paying without penalties.