The Philippines angle

Euromoney Limited, Registered in England & Wales, Company number 15236090

4 Bouverie Street, London, EC4Y 8AX

Copyright © Euromoney Limited 2024

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

The Philippines angle

The killer from Manila


The central bank was already under pressure at home. Senator Edgardo Angara, chairman of the senate economic affairs committee, said on April 7 that the planned yankee bond issue was a mere scheme for the central bank to "window dress" its balance sheet. Angara, a former senate president, added that the bond would "only benefit the investment bank that will oversee the bond float".

The deal also drew flak from Action for Economic Reforms, a policy group composed of academics and non-government organizations, which said the central bank would end up paying interest of $118.75 million to $125 million a year: "The transaction is grossly disadvantageous to the Philippine government. Furthermore the Bangko Sentral's dollar reserves are at an all-time high, and it does not make sense to accumulate reserves by borrowing more."

The Bankers Association of the Philippines voiced its public support - rather embarrassingly on the day before the issue was postponed. Outgoing association president Rafael Buenaventura observed: "The $1.25 billion offering has been analyzed largely from its potential problems but little has been said of its possible upside gains." Incoming association president Deogracias Vistan, president of Solidbank, added: "There may be implicit advantages to the bond offerings which are not readily appreciated outside of the financial market."


Gift this article