Govt yields $500M in ‘samurai’ bonds

THE government returned to the Japanese market on Tuesday by raising 55 billion yen ($500 million or about P24.23 billion) worth of “samurai” bonds.

Samurai bonds are yen-denominated securities issued by non-Japanese entities in Tokyo.

The three-year bond was priced at 21 basis points above the benchmark, which was the tightest spread the government has achieved since its return to the market in 2018.

The Treasury said the initial target size of 30 billion yen was upsized to 55 billion yen “following strong investor demand, allowing the deal to capture new investor base for the Philippines.” It will mature on April 12, 2024. Transactions will be settled on April 12, 2021.
The issuance secured investment grade ratings from international debt watchers Moody’s Investors Service, S&P Global Ratings and Japan Credit Rating Agency.

“The Philippines’ successful return to the Japanese bond market at this precarious time underlines the continued investor confidence in our economy, brought about by its strong fiscal position and prudent management that augurs well for a robust and sustainable recovery from the economic turmoil brought by the Covid-19 [coronavirus disease 2019] pandemic,” Finance Secretary Carlos Dominguez 3rd was quoted as saying.

For his part, Finance Undersecretary Mark Dennis Joven said, “The issuance shows the
Republic’s preparedness to expand its funding sources and the continued confidence and support of its credit investor base.”

Lastly, National Treasurer Rosalia de Leon said, “This landmark transaction highlights the government’s capability to respond to challenging times with creative solutions to free up fiscal space to augment the national government’s Covid-19 response.”

The government last entered the Japanese market in August 2019 when it raised 92 billion yen (about $855.6 million or P41.41 billion) worth of multitenor samurai bonds.