Second panda bond offer
Credit to Author: MAYVELIN U. CARABALLO, TMT| Date: Wed, 15 May 2019 16:25:52 +0000
THE government launched on Wednesday its three-year 2.5-billion renminbi panda bond offering in Beijing.
“Today, we are returning to the panda market. We are pricing as we speak the 2.5-billion renminbi issue,” Deputy Treasurer Erwin Sta. Ana said in an interview.
Transactions for the three-year bond will be settled on May 20, he added.
The Treasury bureau is yet to provide other details of the offering as of press time.
Panda bonds are yuan-denominated debt sold in China by a non-Chinese issuer.
The latest offering is the second made by the Duterte administration; the first was made in March last year, which was met with strong investor demand.
That 1.46-billion-renminbi ($230-million) offering was more than six times oversubscribed, with the order book reaching 9.22 billion renminbi.
It fetched a coupon rate of 5 percent with a tight 35 basis points spread above the benchmark.
That issuance had been rated “AAA” by China Lianhe Credit Rating Co. Ltd., factoring in the strong economic ties between Manila and Beijing and the Duterte administration’s “stable source of payment from growing government revenues.”
The Philippines set a record in the panda bond market then, as almost 90 percent of the offering was cornered by offshore or overseas buyers, with overwhelming demand pushing the coupon rate to its lowest at 5 percent.
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