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Philippines ready for ASEAN+3 multi-currency bond framework




Posted on March 07, 2016


THE PHILIPPINES is ready to take advantage of a new framework for issuance of multi-currency bonds aimed at streamlining cross-border financing in the region.

The ASEAN+3 multi-currency bond issuance framework aims to address the diverse regulations and market practices among the 10 members of the Association of Southeast Asian Nations (ASEAN). BW file photo
“We are looking forward to the ASEAN+3 multi-currency bond issuance framework (AMBIF) to be in effect especially that the Philippines is one of the target countries for this AMBIF issuance,” SEC Chairperson Teresita J. Herbosa said in a speech delivered at the 11th PDS Annual Awards Night in Makati City last week.

SIMPLIFIED
Under the Asian Bond Markets Initiative, the AMBIF aims to address the diverse regulations and market practices among the 10 members of the Association of Southeast Asian Nations (ASEAN) -- Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, Vietnam and the Philippines -- plus China, Japan and South Korea.

With AMBIF, issuers will need to comply with only one set of guidelines in raising funds in an unfamiliar market instead of dealing with different applications in various territories, reducing the time needed to obtain regulatory approval.

Asked for details, Ephyro Luis B. Amatong, SEC commissioner, told reporters that there are two initiatives involving the Philippines that will make use of the AMBIF.

“One is a study for a foreign issuer to issue in the Philippines for peso operations and there’s an ongoing exploration for a Filipino company to issue in another country hopefully this year,” Mr. Amatong said.

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The AMBIF will “manage the foreign exchange risks” of participating companies since they can raise capital “in the currency they are earning also,” the SEC commissioner explained.

The Philippines is among the six jurisdictions -- including Malaysia, Thailand, Singapore, Japan and Hong Kong -- that have been identified as possible markets for AMBIF’s pilot issuance.

“Given the analysis of ADB (Asia Development Bank), it is possible right now to issue a cross-border bond under the AMBIF in the Philippines because it takes advantage of the regulations already in place,” Mr. Amatong said.

Wala ng kailangan baguhin (We don’t have to change anything.)” -- Krista Angela M. Montealegre