The government has successfully raised $1 billion from its Sukuk issuance, marking the first time that the country has tapped the global Islamic financial markets in this structure.
In a statement, the Bureau of the Treasury (BTr) said the transaction attracted strong interest, not only from a wide range of high-quality Islamic investors but from others as well, with the orderbook’s oversubscription peaking at 4.9 times.
The government successfully priced the 5.5-year dollar Sukuk with a profit rate of 5.045 percent.
The transaction is expected to be settled on December 6, 2023.
The BTr said the landmark maiden Sukuk issuance is part of the agenda to promote the development of Islamic banking and finance in the country.
The Sukuk issuance allows the Republic to diversify its global investor base and tap on Islamic-focused investors across the Middle East and marks the establishment of an active, liquid reference curve for other Philippine issuers to access the Sukuk market in the future, the BTr said.
“The success of our inaugural Sukuk issuance affirms the Republic’s significant standing in the international capital markets and underscores investors’ conviction in our financial inclusion agenda,” Finance Secretary Benjamin Diokno said.
“We hope this transaction will create positive momentum for Islamic banking and finance in the Philippines, and we look forward to the active participation of all stakeholders,” he added.
The net proceeds of the certificates will complete the Philippine government’s external commercial funding this year which will be used for general purposes, including but not limited, to budgetary support.
Citigroup, Deutsche Bank, Dubai Islamic Bank, HSBC, MUFG and Standard Chartered Bank acted as joint bookrunners and joint lead managers for the transaction.
