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ADB raises P5.22B via peso bonds for PHL projects

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BERNARD P. TESTA

THE ASIAN Development Bank (ADB) raised over P5 billion in local currency bonds offered to foreign investors, with the funds meant to support projects in the Philippines.

In a statement, the multilateral lender said its recent bond float yielded P5.22 billion ($100 million) through the issuance of four-year currency-linked debt papers.

These bonds carry a fixed interest rate of 5.25%, and are denominated in the peso but will be settled using US dollars.

“The proceeds of the bonds will support ADB’s growing local currency operations in the Philippines and help to reduce foreign exchange risk for ADB’s borrowers,” the lender said on Friday.

The Manila-based development firm said investors from Asia, Europe and the Americas grabbed hold of the bonds, with global bank JP Morgan serving as sole lead manager.

ADB Treasurer Pierre Van Peteghem added that the multilateral lender has been issuing local currency bonds across ADB member-countries. Prior to this offering, the ADB previously floated bonds in the local capital market in 2005 and 2007.

The ADB raised over $23.5 billion from the capital markets through several bond issuances in 2018. In January, the Japan-led regional lender marked their maiden issuance of domestic bonds in Kazakhstan.

Last week, the ADB also bought $20-million worth of green bonds floated by Ayala Corp.’s AC Energy, Inc., which will support the firm’s renewable energy projects in the Philippines.

Headquartered in Mandaluyong City, the ADB lent $1.38 billion in 2018 to support two policy-based loans on public-private partnerships in infrastructure and financial inclusion, the Mindanao growth corridors roads project, and the emergency loans and grants to support recovery for Marawi City.

This year, ADB is looking to extend $2.5 billion to the Philippines, as part of a $7.14-billion lending program until 2021. Among the projects in the pipeline include the Malolos-Clark railway project, the EDSA Greenways project, Angat water transmission improvement project, the secondary education support project, policy-based loans on local governance, youth employment and capital markets, and a capacity-building project to foster competition, according to the ADB website. — Melissa Luz T. Lopez