Philippines Raises $2.25 Billion in Dollar Bonds, €1 Billion in Euro Tranche
The Philippines successfully issued a two-part dollar bond and a euro tranche on Thursday, tapping into the favorable borrowing environment abroad. The Southeast Asian nation sold $2.25 billion (2.4 billion euros) in dollar-denominated bonds with 10- and 25-year maturities, alongside a €1 billion ($1.04 billion) 7-year bond. Notably, the 25-year bond and the 7-year euro bond are designated as sustainable debt.
This offering marks the Philippines' first international bond issuance in 2025 and adds to the increasing trend of Asian borrowers locking in low borrowing costs. The deal highlights the growing popularity of sustainability debt, driven by strong demand for green investments.
The 10-year bond yield was priced at 90 basis points above comparable US Treasuries, lower than the initial guidance of 120 basis points. The 25-year sustainability note has a yield of 5.9%, narrower than the initial range of around 6.1%. Investor orders exceeded $4 billion.
The 7-year euro bond priced at mid-swaps plus 125 basis points, tighter than the initial discussion of 160 basis points.
The Philippines is a significant sovereign bond issuer in the region, relying on overseas funds to finance its budget deficit. The government plans to raise $3.5 billion from overseas bonds in 2025, taking advantage of the current favorable market conditions.
Recent regional borrowers in the dollar bond market include Rizal Commercial Banking Corp. from the Philippines, which issued a $350 million 5-year bond this week, and PT Perusahaan Listrik Negara from Indonesia, which plans to issue a $1.5 billion dollar bond.