Philippines pushes out the curve for infrastructure
Purisima says more local funding to come; Republic targets investment-grade rating
"Our rating matters to us: our goal is to get to investment grade within the current administration"
The Republic of the Philippines is considering issuing more peso-denominated bonds in the local market to help fund infrastructure development, according to secretary of finance Cesar Purisima. Speaking to Euromoney on the sidelines of the Asian Development Bank meeting in Hanoi, Purisima says that infrastructure development is a top priority for the country and that peso-denominated 25-year bonds might be issued to help fund various projects.
"There’s over Ps1.5 trillion in deposits at the central bank," he says, "and we’re keen to tap into that local liquidity to help fund the pipeline of infrastructure development projects. The size of each bond would obviously depend on the project but we can now do 25-year bonds locally thanks to our work in extending the yield curve."
The key deals in this liability management programme came in September and November 2010. In September, taking advantage of strong issuer demand for Philippines bonds, Citi, UBS and HSBC were able to persuade investors to swap over $3 billion-worth of debt into longer-dated paper.