$2 billion is raised by the Philippines amid the Asia Dollar Bond Boom.

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The Philippines recently made a significant financial move by raising $2 billion through a two-part dollar bond sale, marking its first venture into the international market in 2024. This successful issuance could pave the way for similar offerings from corporate borrowers in the Southeast Asian nation. Finance Secretary Ralph Recto disclosed that this sovereign bond sale aligns with the country's plan to secure approximately $5 billion in funding from overseas markets for the year.

The bonds, consisting of $1 billion in 10-year bonds and $1 billion in 25-year sustainability notes, were priced attractively below initial expectations, indicating strong investor interest. This issuance comes amidst a flurry of Asian dollar bond activity in May, with global yields showing signs of easing. The Philippines, a frequent issuer in the region, heavily relies on foreign funds to address its persistent budget deficit, which is estimated at around $26 billion for the year.

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The proceeds from the debt sale are earmarked for general budget funding, as well as financing and refinancing assets in line with the nation's sustainable finance framework. Notably, the Philippines has upcoming bond maturities in September and October, amounting to $774 million and $1 billion, respectively. On the corporate front, Security Bank Corp. is also looking to tap the market with a five-year benchmark dollar bond offering, while SM Investments Corp., the country's largest conglomerate, has established a $3 billion multi-issuer euro medium-term note program.

This move follows the Philippines' previous forays into the international dollar bond market in 2023, including a $3 billion three-part deal and its first Islamic note issuance worth $1 billion in November.

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