Saturday, 10 November 2012

Foreign bond sale generates $750m

By Anna Leah G. Estrada
Manila Standard

The government raised $750 million from the sale of 10-year peso bonds overseas to help finance the budget deficit and manage its debt.

The Finance Department said in a statement the newly-issued peso global bonds, the third of their kind offered by the country, were priced at 100 percent with a coupon of 3.90 percent.

“The transaction allowed global investors the opportunity to participate in the impressive growth story of the Philippine economy, which is considered today to be one of the safest emerging market sovereigns to invest in,” said Finance Secretary Cesar Purisima.

The proceeds will be used to redeem global bonds denominated in euros and the US currency.

The government, which was originally planning to raise up to $1 billion, cut the issuance size after deciding to buy the additional foreign currency from the Bangko Sentral, according to Finance Undersecretary Rosalia de Leon, who was appointed as the new Treasurer.

Foreign exchange reserves of the Bangko Sentral reached a record $82.1 billion in October, more than double what they were at the end of 2008.

“The yield would have stayed at 3.9 percent even if we got $1 billion,” De Leon said in an interview. “We have a lot of cash. It would help Bangko Sentral ng Pilipinas with the peso if we tap the reserves,” she said.

The government said it sold the bonds within eight hours of bookbuilding process, with 30 percent of investors coming from Asia, 41 percent from the United States and 29 percent from Europe.  Investors bid 7.2 times the amount of offer.

“Positive investor perception of the Philippine credit allowed us to achieve our objective of redenominating our debt into the local currency,” De Leon said.

Credit Suisse, Deutsche Bank and HSBC acted as joint global coordinators, while Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, J.P. Morgan, Morgan Stanley, Standard Chartered Bank, and UBS acted as joint bookrunners for the transaction. With Bloomberg

Wednesday, 7 November 2012

Phl finally hosts GT Race Global at BGC

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MANILA, Philippines - The Philippines will finally get to host one of the world’s most exciting, most watched racing events – the GT Race Global – which zooms off early next year at the Bonifacio Global City in Taguig, with some of the world’s finest drivers behind the wheels of 24 supercars of the rich and famous.

The world’s top-of-the-line cars - Lamborghini, Ferrari, Aston Martin, Corvette, Ford, Porsche, Lotus, BMW, Maserati and Mercedes-Benz – and others sporting engine power ranging from 800 horsepower and beyond will clash for fame and fortune in the event held for the first time in the Philippines.

Monday, 5 November 2012

Sustained Domestic Economic Growth Is Seen To Cap This Year

By EDU LOPEZ Manila Bulletin The Philippine economy is one of the best performing economies in Asia as multinational and financial institutions have projected sustained growth of the country's gross domestic product (GDP). While some Asian economies have posted declines in GDP performance, the domestic economy experienced robust growth in the first half of 2012 and continuous to exhibit strength despite the global and regional economic slowdown. The Asian Development Bank (ADB) has raised its GDP growth forecast for the Philippine economy to 5.5 percent for 2012 from 4.8 percent. Stronger than expected economic growth in the first half of 2012 was broadly based. Private consumption was buoyant, fixed capital investment quickened, public spending rebounded, and net exports contributed to growth. Inflation remains under control at 3.5% for 2012. However, ADB said the economy needs to create more job opportunities to link economic growth to poverty reduction.

Fearless Forecast: PSEi At 10,000

Manila Bulletin

Online brokerage firm COL Financial, formerly, expects the Philippine Stock Exchange Index (PSEi) to hit 10,000 by 2016, almost double the current level.

According to COL Financial president Conrado Bate, they are optimistic that the fearless forecast will happen because, “for the first time in the history of the Philippines, we enjoy a credit rating which is just one notch below investment grade.”

He noted that this is a consequence of the steady improvement in the country’s finances. This includes the country’s foreign exchange reserves which have increased 5 times since 2005, thanks to the strength of remittances and the business process outsourcing sector.

“Our fiscal deficit is a mere 2 percent of GDP (gross domestic product) while inflation has remained under control. Compared to our Asian neighbors, we are also less vulnerable to developments in the US, Europe and China since we are the least export dependent, with domestic consumption accounting for 70 percent of GDP,” said Bate.

He added that the outlook for domestic consumption is also very favorable by 2015, the Philippines will enter what is commonly known as the “demographic sweet spot,” the period where half of its population will be of working age.

“There are also several developments that make us excited about the near future. Investment opportunities are becoming more tangible as the government’s Public Private Partnership projects are gaining momentum,” said Bate.

Meanwhile, he said a solution to the Mindanao problem seems to be at hand, noting that this would add another growth driver to the Philippine economy which in the past had to depend on the islands of Luzon and Visayas for growth.

“As stock market investors, we have this wonderful opportunity to participate in the country’s economic growth, and we believe one of the best ways to partake in this is by investing in the country’s top conglomerates who are poised to invest and grow in our economy,” said Bate.

Peso seen to hit 30:$1 next year

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CEBU, Philippines -  The peso could strengthen to the 30-level against the dollar next year as investors continue to flood emerging markets regardless of the outcome of the US elections on Tuesday, an investment bank said.