PSALM to issue $250-M bonds to raise funds for Napocor

The Power Sector Assets and Liabilities Management Corp. (PSALM) will issue some $250 million-worth of bonds in the first quarter to raise part of the National Power Corp.’s (Napocor) financing requirement for 2003.

PSALM president Edgardo del Fonso, in a telephone interview, said the Overseas Private Investment Corp. (OPIC) of the United States government will provide a political risk guarantee for the bond float.

"The guarantee, that will be extended by the OPIC, will add to the attractiveness of the bonds. We can use this (guarantee) to attract investors to buy our bonds," Del Fonso said.

Del Fonso said they are in the process of securing the approval of the country’s regulatory bodies for the bond issuance.

"We are currently in the process of securing the approval of the Department of Finance (DOF) and the Monetary Board of the Bangko Sentral ng Pilipinas (BSP)," he said.

US Ambassador Francis Ricciardone, in a speech during a recent memorandum of understanding (MOU) signing between OPIC and the Philippine Export and Import Corp. (Phil-Exim), said OPIC will take an active role in the power firm’s proposed bond float.

"OPIC is heavily involved in funding the energy sector in the Philippines. We’re moving ahead, with OPIC involved in a $250-million bond offering for the Napocor," Ricciardone said.

OPIC has supported $142 billion of investments overseas in developing countries. These investments have helped developing countries, on their own, over $11 billion in host country revenues.

A US government agency, OPIC, sells political risk insurance and loans to help US businesses of all sizes invest and compete in more than 140 emerging markets and developing nations worldwide. It charges market-based fees for its products, and therefore operates on a self-sustaining basis at no net cost to taxpayers.