THE PHILIPPINES, one of Asia’s most active sovereign bond issuers, raised $500 million from a new 25-year US dollar bond offering, in a sign of investor confidence in the country and the new government under President Rodrigo R. Duterte.

The bonds, which attracted strong demand amid financial market volatility, were priced at par with a coupon of 3.7%, below the initial guidance of 3.95%, the Department of Finance said in a statement on Thursday.

It was the tightest-priced long-dated global bond offering ever issued by the Philippines, which also switched $1.5 billion worth of new 25-year global bonds with shorter-dated and more expensive debt.

Global investors across Asia, the United States and Europe took part in the $2-billion bond deal, National Treasurer Roberto B. Tan said, adding that the new money component of $500 million and switch tender of $1.5 billion were both oversubscribed.

Mr. Tan said the successful issue was a “testament to the resilience of the Philippine economy as well as the strong faith that these investors have in the Duterte administration in executing and implementing reforms and strategies.” The Philippine economy grew at its fastest pace in more than three years in the third quarter, most of Mr. Duterte’s first 100 days in office, setting him up to meet the 6-7% growth he set for 2016. Mr. Duterte, who was elected in May on a promise to wipe out drugs in the Philippines, has promised to continue the reforms of his predecessor that helped the economy grow more than 6% on average — its best six-year record in four decades.

Citigroup, Credit Suisse, Deutsche Bank, Standard Chartered Bank and UBS acted as joint global coordinators, dealer managers and bookrunners for the transaction.

The Philippines’ last US dollar issue was in February 2016 when it sold $2 billion of 25-year bonds also at 3.7%, the lowest ever. — Reuters

20 January 2017