• Govt to issue P100B retail bonds for infra

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    The national government is issuing today P100 billion worth of 10-year, retail treasury bonds (RTBs) to fund the Duterte administration’s infrastructure and social services projects.

    The issuance includes the P65 billion initially raised by the Bureau of the Treasury (BTr) on September 6, and P35 billion as of September 16.

    “Originally, P65 billion of the RTBs were issued at the coupon setting auction last September 6. The issuance was increased after the nine-day public offer period, and subsequent road shows raised considerable demand for the securities in the order books of the authorized selling agents,” the BTr said in a statement on Monday.

    The coupon rate of the 10-year RTB stood at 3.5 percent, or 71.8 basis points below the previous average of 4.218 percent and higher than the secondary market rate of 3.4208 percent.

    This represents the 18th tranche of retail bonds issued by the bureau, and the first under the Duterte administration.

    “The expanded issuance aims to ensure that the RTB attains its goals of reaching a wide investor base, promoting savings and investment consciousness among Filipinos, and mobilizing domestic savings,” the bureau said.

    Dealers that qualify as selling agents were given incentives to sell at least half of their allocated volumes to retail investors, it added.

    “The funding exercise forms part of the financing program to meet the government’s requirements, as it aims to increase infrastructure spending and improve the provision of social services,” the BTr pointed out.

    These are key points in the administration’s socioeconomic agenda in which investors have shown confidence, as shown by the high demand the issuance has garnered, it said.

    The BTr has tapped BDO Capital & Investment Corp., BPI Capital Corp., Development Bank of the Philippines, and Chinabank Capital as issue managers for the retail bond offering.

    Land Bank of the Philippines and First Metro Investment Corporation were designated as the lead issue managers.

    Among the authorized selling agents are BDO Universal Bank, Citibank N.A., East West Banking Corp., ING Bank, Metropolitan Bank & Trust Company, Philippine Bank of Communications, Rizal Commercial Banking Corp., Robinson Bank Corp., and Security Bank Corp.

    In the 2013 RTB issue, the minimum offer of P30 billion was oversubscribed by 906 percent. The total proceeds reached P150 billion at a yield rate of 3.25 percent.

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