NG to maximize $1.5-B bond float

Finance Secretary Jose T. Pardo said yesterday the National Government will try to complete its planned $1.5 billion international bond float in the next two months while the prevailing market condition is still favorable.

"We want to take advantage of the prevailing strong confidence of institutional investors in the local economy," Pardo said.

"In the next six weeks, we will begin book building a portion of the $1.5 billion. Within the next two months, it is safe to say that we may be able to finish it (bond float)," he added.

According to Pardo, they have been advised by most of the investment banks such as JP Morgan, Morgan Stanley, Salomon Brothers to tap the bond market now.

Pardo also said they are now in the process of implementing a new system in choosing fund managers to handle the government bond issuance.

Both the Department of Finance (DOF) and the Bangko Sentral ng Pilipinas (BSP) will assign a representative in the negotiating table for each issuance of bonds by either the DOF or BSP.

"If DOF will issue, BSP will send its Deputy Gov. Amando Tetangco. The same with BSP, they will float bonds, the DOF will send Undersecretary Joel Banares to represent the National Government," he said.

The government wants to float as much as $1.5 billion worth of bonds to contain the widening budget deficit, while the BSP plans to issue from $500 million to $1 billion worth of bonds through syndicated loans to refinance its maturing obligations this year.