Saturday October 17, 1:13 PM
Storm-wracked Philippines raises $1 bln in bonds
The Philippine government announced Saturday that it successfully raised one billion dollars in 25-year global bonds amid a growing need for rehabilitation funds after two destructive storms.
This marks the third international global bond issue for the Philippines this year and the first 25-year bond offer since January 2007, the finance department said in a statement.
"We are very pleased to have been able to extend the republic's maturity profile while at the same time achieving the lowest yield for a new 25-year benchmark US dollar global offering by the Philippines," finance secretary Margarito Teves was quoted as saying.
"Positive investor reception for this transaction allowed us to resume our long-term borrowing strategy to achieve our funding objective in support of our fiscal programme," national treasurer Roberto Tan also said.
Deutsche Bank Securities Inc., HSBC and UBS AG acted as joint lead managers and joint bookrunners for the transaction.
The bond offer comes after the government announced that it would have to raise revenues sharply to pay for relief and repairs after tropical storm Ketsana and typhoon Parma struck one after another from September 26.
The two storms caused massive flooding in the capital Manila and surrounding areas as well as killer landslides in mountainous areas in the north, resulting in almost 800 deaths and at least 21.6 billion pesos (463 million dollars) in damage to agriculture and infrastructure.
President Gloria Arroyo's economic aides have expressed concern this week that storm damage may cause the budget deficit this year to shoot past 300 billion pesos.
They see reconstruction costs and slower economic activity as putting pressure on Manila's full-year budget deficit target ceiling of 250 billion pesos, or 3.2 percent of the projected gross domestic product for the year.
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