Philippine bond issue dollars, euros, and yen
Finance March 26th, 2010
Philippines central bank gave initial approval of the government’s plan to publish the U.S. dollar-denominated bonds, euro, yen to cover the budget deficit widened.
Sources who know the plan said the monetary authority in principle to allow the government to sell global bonds worth U.S. $ 1.5 billion. In addition, he added, was also given approval for emissions plan bonds denominated in yen for U.S. $ 500 million.
“If permission has come down from the central bank, we can throw into the market anytime,” said Minister of Finance Gary Teves told reporters in Baguio City, south of Manila.
Permission from the central bank is required before the government can determine the investment banks to arrange the sale.
Teves explained the government needs funds to cover the estimated deficit ballooned to more 293 billion pesos (U.S. $ 6.3 billion) in 2010, from about 290 billion pesos last year.
Philippines Bloomberg data shows the U.S. dollar selling bonds every January since 2005.
The government plans to reap U.S. $ 2 billion of bonds overseas next year with the estimated 2010 deficit of 233.4 billion pesos. Along with growing losses, Teves said, interest rates also rose.
Countries in Southeast Asia plans to sell euro-denominated bonds for the first time in 2010. While the yen began in 2001.
The Philippines has a bond that will mature in February valued at 650 million euros (U.S. $ 932.9 million) and U.S. $ 561.5 million maturing in March.
