6 banks tapped for peso global bonds

MANILA, Philippines - The Department of Finance (DOF) has mandated six banks for its planned peso-denominated global bonds, which Finance Secretary Cesar Purisima said might be launched within the month or soon after the European and US summer holiday.

A government official privy to the planned transaction said that the six banks have been tapped as arrangers for the transaction.

The lead coordinators are Citigroup Inc. and Deutsche Bank AG. The other bookrunners are Credit Suisse Group AG, Goldman Sachs Group Inc., HSBC and JP Morgan Chase & Co., according to another source.

Earlier in the day, Purisima confirmed that the government has given the mandate to several banks for its planned maiden peso-denominated bonds.

Purisima nonetheless said the government is ready to launch up to $1 billion in global bonds soon.

“It’s ready to launch but I leave it up to the Treasury to execute,” he told reporters yesterday on the sidelines of budget hearing conducted by the Senate committee on finance.

The Finance chief said it should be done anytime soon.

He said the final size of the offer and the exact timing of the issue would depend on the appetite of the market.

Asked if the government would issue the peso-denominated global bonds ahead of a separately planned dollar bond swap, Purisima said it would depend on “market conditions.”

“The bond swap is still a go but we have to check on market conditions. Whichever the market will allow us to do, we will do first,” Purisima said.

The dollar bond swap is among the plans of the Aquino administration in managing its debts.

National Treasurer Roberto Tan earlier said the government plans to issue 10-year and 20- or 25-year dollar bonds in exchange for maturing bonds in the market.

The move is part of efforts to lengthen maturing obligations.

Traders expect the government to proceed with the peso-denominated global banks ahead of the dollar bond exchange.