Bond issuances at Philippine Dealing & Exchange Corp. surged 440 percent in the first five-and-a-half months to P107.28 billion from P9.18 billion a year ago, as more companies tapped the bond market to finance expansion plans.
PDEx chairman and chief executive Cesar Crisol said in a speech during the recent listing of the P4.18-billion long-term negotiable certificates of time deposits by Robinsons Bank that 2017 was expected to be a landmark year in terms of domestic bond issuances, given the robust pipeline of bond listing.
Robinsons Bank’s P4.18-billion LTNCTD listing was the 14th corporate issuance this year.
Crisol said the number of listing before end-June was expected to reach 16, matching the new listings in the whole of 2016.
“We have good reason to be optimistic that 2017 will be a landmark year domestic bond issuances,” Crisol said.
Among the companies that tapped the bond market in the first half were Megaworld Corp., Ayala Land Inc., San Miguel Corp., Ayala Corp. and STI Education Service Group.
Upcoming bond offerings include the P30-billion bond offering of Aboitiz Power Corp., the P9.7-billion bond offering of DoubleDragon Properties Inc. and the P20-billion bond offering of Vista Land & Lifescapes Inc.
Data showed that with Robinson Bank’s issuance, the combined outstanding securities of JG Group listed on PDEx reached P46.2 billion, representing 6.5 percent of the total corporate fixed-income issues in the registered market.
PDEx said it was expecting total bond issuances listed on the fixed-income exchange to reach P150 billion in 2017, despite possible rate increases.
Crisol said companies would likely continue to tap the bond market to fund their capital requirements for 2017 and refinance maturing obligations.
He said companies engaged in infrastructure would also tap the bond market for their funding requirements.
PDEx credited the move of the Securities and Exchange Commission to allow shelf-registration program for the significant increase in bond issuances.
Under the program, companies are allowed to register and issue securities in tranches on a continuous or delayed basis for a period not exceeding three years. This means the issuers can time their capital raising activities as they are needed and/or when market conditions favor them.
Fundraising through the fixed income exchange amounted to P136.46 billion in 2016, up by 27 percent from P107.4 billion in 2015.
