Philippines plans jumbo sale of 10-year bond amid volatility

The Philippines is set to sell a big volume of 10-year Treasury bonds this month, helping secure government funding at a time of increased market volatility.

Although the initial offering is expected at around 30 billion pesos ($525 million), the final issue size could reach at least 100 billion pesos, said Helen Oleta, president of the Fund Managers Association of the Philippines.

In a bid to “provide a clear market” for the new issue, the Bureau of the Treasury canceled its auction of 15-year bonds that was set for April 22, Treasurer Sharon Almanza said in a memorandum on Friday. The public offer of the 10-year fixed-rate treasury notes, typically targeted toward institutional investors, will run from April 15 to 24, she said.

The announcement comes a day after the Bangko Sentral ng Pilipinas reduced its key interest rate and flagged further cuts. Last month, the BSP lowered banks’ reserve requirement ratio, releasing around 300 billion pesos into the financial system.

“It’s been a while since we’ve seen a jumbo issuance,” said Oleta of the fund managers association, noting that big offerings in recent years were mainly retail bonds.

“There are excess funds looking for alternative investments as further cuts are expected from our central bank,” Oleta said. Fixed income instruments are more appealing now given the turmoil in financial markets fueled by uncertainty over the US’ evolving tariff actions, she added.

In January, the Philippines raised $3.3 billion in a two-part dollar and euro bond sale, being left with about $200 million to complete its foreign commercial bond program for this year. Officials said at that time that they’re weighing whether to raise the balance locally.