Bond listings to hit new high next year

MANILA, Philippines — The Philippine Dealing and Exchange Corp. (PDEx) sees another banner year for the fixed-income exchange with funds raised through bond listings growing by 22.5 percent to a record P475 billion as the operator launches a new digital portal.

PDEx president and chief executive officer Antonio Nakpil told The STAR the ambitious target was set in view of the digitalization initiative the PDS Group is launching next year.

Nakpil said the initiative is aimed at streamlining the key activities in debt primary offerings.

“The focus is on electronification in the areas of applications and submissions for listings by issuers, and the processes for the capture, allocation and consolidation of investor purchase orders to the final on-boarding of client investors into the electronic registry for each new corporate security,” Nakpil said.

The group hopes to fully operationalize the PDS issue portal allowing the electronic submission of requirements for issuers and onboarding of client investors.

This would facilitate more bond listings by simplifying the process for companies and investors.

Despite the impact of the coronavirus disease 2019 or COVID-19 pandemic, funds raised via the PDEx platform inched up by 3.25 percent to a new record of P387.83 billion this year. There were 36 listings recorded for 2020.

“The fact that a new record was reached through the alternative work arrangements brought about by the crisis is notable. Other than that, majority of the issuers brought their instruments to market and were greeted with over-subscriptions by the investor community, as normally observed in the past couple of years,” Nakpil said.

Philippine banks accounted for about 67 percent of the total funds raised via the fixed-income exchange at P259.6 billion led by the Sy-led BDO Unibank Inc. with P76.1 billion including the record P40.1 billion issuance in February, followed by Ayala-led Bank of the Philippine Islands of the Ayala Group with a total of P70.7 billion, Yuchengco-led Rizal Commercial Banking Corp., with P24 billion, and state-run Development Bank of the Philippines with P21 billion.

The debt issuance by Philippine banks last year was 4.5 percent lower than the P268.98 billion raised in 2019 as the industry continued to tap the domestic debt market to raise funds to diversify funding sources and bankroll their respective expansion program.

New listings at the country’s trading platform for fixed income securities have been rising steadily for the past five years with P107.39 billion in 2015, P109.66 billion in 2016, P207.43 billion in 2017, P256.4 billion in 2018, and P375.6 billion in 2019.

In 2014, new listings reached P191.85 billion.