- The Philippines has sold out the country’s first-ever tokenized bonds.
- Investor bids outsized the target issue, causing an upsize.
- The country notes the program will extend to retail investors soon.
The Philippines has successfully sold millions of dollars of the republic’s maiden tokenized treasury bonds (TTBs), scheduled to mature in November 2024.
On November 16, the Bureau of the Treasury (BTr) announced that it would offer the first-ever Philippine peso-denominated TTBs in a bid to raise at least 10 billion pesos from the domestic bond market.
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When bidding opened on November 20, BTr reported strong demand from qualified institutional investors, with the size of the book spiraling to over three times the target issue size.
Treasury Upsizes the Issue, Raises $271 Million
According to a press release issued Monday, following the spike in demand, BTr upsized the issue of its maiden TTBs to 15 billion pesos ($271 million) at a coupon of 6.5% per year.
After settlement on November 22, the TTBs will be issued in the form of digital tokens to be maintained in the BTr’s Distributed Ledger Technology (DLT) Registry.
For this program, BTr noted that it has created a dual registry structure, where the DLT registry runs in parallel with the National Registry of Scripless Securities (NRoSS). NRoSS will serve as the primary registry in the setup.
Philippines Finance Secretary Benjamin E. Diokno lauded the issuance of the TTBs, noting that the program is anchored on the National Government’s long-term vision of a financially inclusive domestic capital market.
“Through streamlining settlement procedures and minimizing friction costs, this initiative is a huge leap towards our end goal of democratizing investment and empowering our small investors.” Diokno stated.
With the issuance, the Philippines has implemented a proof of concept for the broader application of DLT in the government bond market. While the program is currently limited to institutional investors, Bangko Sentral ng Pilipinas (BSP) Governor Eli M. Remolona hinted that it would expand to retail investors with time.
Read this article to understand how tokenization is taking shape in other parts of Asia:
Hong Kong Targets Security Tokenization with New Guidelines
Stay updated on how Singapore is driving asset tokenization:
Singapore Drives Asset Tokenization Campaign with New Pilots
