Treasury cancels July 5 T-bond auction


Posted at Jul 01 2011 04:55 PM | Updated as of Jul 02 2011 12:55 AM

MANILA, Philippines - The Bureau of Treasury said on Friday it had scrapped an auction of 7-year Treasury bonds scheduled on July 5 to give way to the launch of a domestic bond swap, its first this year.

The government, aiming to better manage its debt profile by stretching its maturities, will open a local bond exchange next week, offering to swap new 10.5-year and 20-year bonds for shorter-dated and illiquid securities.

It plans to issue a minimum P40 billion to P50 billion for each maturity, one of the arrangers of the deal said on Tuesday, with the final issue size expected to match a record domestic bond swap in December.

Finance Secretary Cesar Purisima told reporters on Friday the Treasury had obtained all regulatory approvals this week, clearing the way for the debt exchange.

First Metro Investment Corp., BPI Capital Corp., SB Capital Investment Corp. and Citibank are joint deal managers of the latest debt swap, along with state lenders Development Bank of the Philippines and Land Bank of the Philippines.

The Philippines issued around P185 billion of new 2020 and 2035 benchmark bonds via its largest domestic swap in December. It also raised P15 billion from the same offer.