THE Department of Finance (DOF) said Daiwa Securities Group (Daiwa) has expressed readiness for the next issuance of samurai bonds by the Republic of the Philippines, adding the country should issue the yen-denominated security on an annual basis.
In a meeting with Finance Secretary Carlos G. Dominguez III, top executives of Daiwa led by its Chairman Takashi Hibino said the bank “could be of help in terms of financing” to further accelerate infrastructure investments in in the second half of President Duterte’s administration.
Hibino told the finance chief that Daiwa “is ready” for the Philippines’s next samurai bond float and advised that the government should issue such bonds at least once a year—even in just modest amounts—to reach more investors.
Daiwa earlier extended its offer in terms of providing funding for the Duterte administration’s “Build, Build, Build” (BBB) program and continue its support for the Philippines’s future yen-denominated bond issuances in the Japanese market.
Dominguez, in turn, thanked Daiwa for its “invaluable assistance that led to the Philippines’s successful return to the Japanese market in August with its samurai bonds after an eight-year absence.”
The Philippines’s multi-tranche issue was the largest samurai transaction in Asia at ¥154.2 billion. The three-year tranche was priced 25 basis points above the benchmark, the five year at 35 basis points and the 10-year tranche at 60 basis points. It was the first time in almost 20 years the government issued samurai bonds on a stand-alone basis.
Dominguez told the Daiwa executives that the Philippine government was looking forward to its partnership with Daiwa in future offshore transactions.
“It is more important for us now to continue stimulating the economy by doing the infrastructure program. That is our countercyclical approach. We will be tapping the international markets for bond financing so it’s a perfect fit and we hope your organization can continue supporting us,” Dominguez said.
He said the Duterte administration would further scale up its infrastructure program to continue stimulating the economy amid global uncertainties triggered by the escalating United States-China trade tensions and the Federal Reserve System’s move to normalize monetary policy through successive interest-rate increases.