PH to be active in Panda bond, Samurai bond markets

By Joann Villanueva

August 28, 2018, 6:32 pm

MANILA -- Panda bond and Samurai bond issuances will be a normal funding source for the Philippines under the Duterte administration, Finance Secretary Carlos Dominguez III announced on Tuesday.

“As I mentioned to the (Bureau of the) Treasury, yes, I told them that I don’t want to be absent from any major market. The Renminbi (-denominated Panda bond) is the first issue we had (and) we probably will go back within 12 or 18 months. The same with Japan,” the Department of Finance (DOF) Secretary said in an interview by reporters after the 2nd Economic Journalists Association of the Philippines (EJAP) Forum.

The Philippines issued 154.2-billion worth of Japanese yen-denominated multi-year Samurai bonds last August 8 after an eight-year break. It is the first in nearly 20 years that the issuance is not guaranteed by any Japanese institution.

Last March, the government issued its first-ever RMB 1.46 billion three-year renminbi-denominated Panda bond, which is issued by a non-Chinese issuer in China.

The Duterte government is now active at overseas capital markets as part of its bid to diversify investments and take advantage of low interest rates given the country’s investment-grade ratings.

Dominguez explained that “we learned that it’s very difficult to get back into a market if you are absent for like eight years.”

“We were not in the Japanese bond market for eight years and it was a little difficult. If we do one issue every year or every 18 months it should be good for us,” he said.

The Finance chief said they have not determined how much would be issued in the coming years.

“I don’t have any amount yet (but) we have already done what we need to do. Our plans for this year are already finished so we will see what goes on next year,” he added. (PNA)