Philippines says retail bond sale may reach nearly $5 bln
MANILA, Oct 9 (Reuters) - The Philippines may raise as much as 200 billion pesos ($4.82 billion) from its 25-year retail bond debut, which could lead to lower debt issues in 2013, a senior government official said on Tuesday.
Investor demand for the longer-dated debt was strong, with tenders at Tuesday's auction reaching 76.5 billion pesos, allowing the government to raise close to 63 billion pesos, or more than double the minimum issue size of 30 billion pesos.
"We are happy with that result," Deputy Treasurer Eduardo Mendiola said, adding that robust investor take-up was a vote of confidence in the economy.
Following Tuesday's auction, there will be a public offer until Oct. 22. The government hopes to sell more of the bonds, which are meant to provide small investors with safe investment options.
The final sale amount could reach as much as 200 billion pesos, Mendiola said. To date, the record for a retail bond sale was 180 billion pesos, in February.
"We can see that there is so much demand and we will try to accommodate all investors who would want to invest as much as possible within the two week offering period," Mendiola told reporters.
"If we get a lot (of demand), then we will probably have to reduce some of our regular issues," Mendiola said. "We will decide next quarter."
Manila set the coupon rate for the 25-year retail T-bond at 6.125 percent, slightly lower than secondary market yields for similarly dated paper.
The Southeast Asian country borrows from the local and foreign debt markets to help fund its budget deficit, which is on track to undershoot this year's target of 279 billion pesos, or 2.6 percent of gross domestic product.
The government raised a record 180 billion pesos from the sale of 15-year and 20-year retail bond issue in February. It also sold 110 billion pesos from its October 2011 retail bond offer.
State-run Development Bank of the Philippines and Land Bank of the Philippines were appointed as joint issue managers.
BDO Capital and Investment Corporation, China Banking Corp , Citicorp Capital Philippines, Inc, Deutsche Bank AG , First Metro Investment Corp , Metropolitan Bank & Trust Co , PNB Capital and Investment Corp, Rizal Commercial Banking Corp were hired as co-issue managers.
($1 = 41.4700 Philippine pesos)
(Reporting by Karen Lema; Editing by Richard Borsuk)
Keywords: PHILIPPINES ECONOMY/TBONDS