International mag names RP `Asia-Pacific Borrower of the Year

The Philippines has been named as the "Asia-Pacific Borrower of the Year" for successfully tapping new markets for its debt papers with sizeable deals.

The award was accorded by the prestigious International Finance Review magazine, a niche publication in the world of finance, which hailed the country's entry into the Euro Capital market, the cash gains of $412 million on its Brady deal and a $1-billion global bond offering.

IFR said the Philippines "borrowing power" was demonstrated by the volume of $2.75 billion bond float accounting for nearly half of the sovereign issuance from the region.

The Philippines even beat Korea to access in the international capital market with its $1-billion global bond offering that was deemed significant as the country's finance officials refused to increase the rates following the instability in Latin America.

This 20-year global bond was so hugely successful that an additional $200 million was booked barely a week after it was launched and at a lower spread of 436 basis points over US Treasuries.

JP Morgan's Kate Richdale, vice president of debt capital markets, said "there was a real fight as to which sovereign issues would come out first. When the Philippines came head-to-head with Korea, it beat them hands down."

"The Philippines can basically access any market it wants. It is inundated with proposals at the moment," Richdale said.

Recalling the feat, Rogelio Paglomoduan, deputy treasurer of the Philippines Bureau of Treasury said: "Most of the Asian countries had failed to borrow at that time, but the international market was receptive inspite of the fact that the Asian region was still recovering."

Another milestone which IFR cited in its award to the Philippines was in March when the country became the first -- and to date the only -- Asian sovereign to issue euro-denominated bonds.

Considered a strategic move, the deal, which raised a lower euro 350 million from its initial 500 million, introduced the Philippines to investors from the United Kingdom, Germany, Italy, France, Switzerland, Spain and the Benelux countries.

"If the Philippines were to borrow today in euros, they would already have a loyal investor base in Europe," said IFR.

But IFR said the greatest financing coup of the Philippines was its Brady bond exchange in October as it "best exemplified the Philippines multi-faceted fundraising program."

The deal allowed the country to retire $72 million in net debt, realized $421 million in cashflow from amortizing bond for the period 1999-2005, captured net present value savings of $18 million and realized almost $150 million in Brady bond collateral.

More than 200 institutional investors participated in the 25-year global bond offer.