By Joann Villanueva
MANILA – Major credit rating agencies have given the Philippines’ planned benchmark Euro bond issuance investment grade ratings.
In a statement Monday, S&P Global Ratings said it has assigned a ‘BBB+’ rating on the country’s planned issuance.
“The notes represent direct, general, unconditional, unsecured, and unsubordinated obligations of the sovereign, and rank equally with the sovereign’s other unsecured and unsubordinated debt obligations,” it said.
Fitch Ratings gave the planned issuance an expected rating of ‘BBB’.
“The expected rating is in line with the Philippines’ Long-Term Foreign Currency Issuer Default Rating (IDR) of ‘BBB’ with Stable outlook,” it said.
On Monday, National Treasurer Rosalia de Leon said they have tapped four banks – – UBS, Citi, Standard Chartered, and Credit Suisse– for the planned bond issuance.
De Leon said they have started the investor calls Monday to check on market conditions but clarified they have done the indication in terms of tenor both for three and nine years.
She added they decided to announce the planned Euro bond issuance instead of the dollar bond because “obviously, you have to look at some strategy in assessing market conditions.”
De Leon said there is a “give and take advantage” of the negative yields in the Euro area right now.
“Obviously, we’ve been opening markets every year on the dollar but this time, we would want to approach the European investors coming from a very strong order book last year,” she said.
De Leon said there are still spillovers from last year’s issuance “that we’re not able to accept so we’re coming back for this issue.”
In May last year, the Philippine government raised 750 million euro (USD842) from the issuance of eight-year debt paper. (PNA)