State-owned Development Bank of the Philippines (DBP) has successfully raised P11 billion through its latest bond issuance, exceeding its initial target by a significant margin. The strong investor demand reflects growing confidence in the bank’s role as a key player in supporting the Philippine economy.
DBP President and CEO Michael O. de Jesus announced that the bank’s Fixed Rate Series 6A and 6B Bonds were oversubscribed by five-and-a-half times, surpassing the minimum offer size of P2 billion.
“This successful bond issuance underscores the trust and confidence that the market places in the bank as a government financial institution,” de Jesus said. “It provides us with the necessary financial flexibility to expand our lending activities and actively contribute to the Marcos Administration’s economic agenda.”
DBP’s crucial role in nation-building
DBP, the 10th largest bank in the Philippines in terms of assets, plays a crucial role in supporting four key sectors of the economy: infrastructure and logistics, micro, small, and medium enterprises (MSMEs), environment, and social services and community development.
The DBP Fixed Rate Series 6A bonds, with a tenor of 1.5 years, were offered at an interest rate of 6.0503% per annum. The 6B bonds, with a three-year tenor, carried an interest rate of 6.1294% per annum.
These bonds, traded through the Philippine Dealing & Exchange Corporation, represent the sixth tranche of DBP’s P150-billion bonds program.
This successful bond issuance marks a significant milestone for the state-owned bank. It is the first time the bank has issued two tenor bonds simultaneously, demonstrating its commitment to offering tailored solutions to meet the diverse needs of investors while effectively supporting its critical development goals
Bond proceeds to finance loans to DBP’s clients
The proceeds from this bond offering will be utilized to finance loans to DBP’s clients across various sectors, including infrastructure projects, MSME development, environmental initiatives, and social services.
This strategic allocation of funds will contribute significantly to the government’s economic recovery and development plans.
DBP’s successful bond issuance highlights the growing importance of the debt capital markets in supporting government initiatives and driving economic growth in the Philippines. By diversifying its funding sources, DBP can effectively meet the increasing demand for credit and play a vital role in advancing the country’s economic development agenda.
The Development Bank of the Philippines has played a crucial role in the Philippine economy by providing financial support to key sectors such as infrastructure, MSMEs, and environmental projects. It has consistently demonstrated strong financial performance ever since.
DBP’s support to the government’s economic development agenda
In 2022, the bank experienced significant growth, with net income surging by 50% to P5.61 billion, driven by increased lending activities across various sectors. This robust performance reflects DBP’s commitment to supporting the government’s economic development agenda and its ability to navigate the challenges of a recovering economy.
Late last year, the bank was also recognized for excellence in sustainability and corporate governance, garnering the “Green Initiatives Award” at the Asia Corporate Excellence and Sustainability (ACES) Awards 2024.
Presented by the Malaysia-based MORS Group, this prestigious award acknowledged DBP’s leadership in integrating Environmental, Social, and Governance (ESG) principles into its core business operations.
The bank has consistently demonstrated its commitment to supporting strategic industries that have a significant impact on the country’s economy. In recent years, it has prioritized infrastructure development, channeling a significant portion of its resources towards projects such as road networks, transportation, energy, water, housing, and healthcare.
This strategic focus aligns with the government’s goal of promoting sustainable and equitable economic growth across the country.
