SOURCE: Republic of Philippines

September 29, 2010 18:28 ET

The Republic of the Philippines Announces the Results of Its Global Bond Offering

MANILA, PHILIPPINES--(Marketwire - September 29, 2010) - The Republic of the Philippines (the "Republic") announced today the results of its invitation (the "invitation") to the holders of its 8.375% Bonds due 2011 ("2011 Bonds"), 9.0% Bonds due 2013 ("2013 Bonds"), 8.25% Bonds due 2014 ("2014 Bonds"), 8.875% Bonds due 2015 ("2015 Bonds"), 8.0% Bonds due January 2016 ("January 2016 Bonds"), 8.75% Bonds due October 2016 ("October 2016 Bonds") and 9.375% Bonds due 2017 ("2017 Bonds," and together with the 2011 Bonds, 2013 Bonds, 2014 Bonds, 2015 Bonds, January 2016 Bonds and October 2016 Bonds, the "Group A Bonds") to submit offers to exchange each series of Group A Bonds for newly issued U.S. dollar-denominated Global Bonds due 2021 ("New 2021 Bonds") or reopened 6.375% Global Bonds due 2034 ("Reopened 2034 Bonds"), and to the holders of its 9.875% Bonds due January 2019 ("January 2019 Bonds"), 8.375% Bonds due June 2019 ("June 2019 Bonds"), 7.5% Bonds due September 2024 ("September 2024 Bonds"), 9.5% Bonds due October 2024 ("October 2024 Bonds"), 10.625% Bonds due 2025 ("2025 Bonds"), 9.5% Bonds due 2030 ("2030 Bonds") and 7.75% Bonds due 2031 ("2031 Bonds," and together with the January 2019 Bonds, June 2019 Bonds, September 2024 Bonds, October 2024 Bonds, 2025 Bonds and 2030 Bond, the "Group B Bonds") to submit offers to exchange Group B Bonds for Reopened 2034 Bonds (the Group A Bonds and Group B Bonds are collectively referred to as the "old bonds," and the New 2021 Bonds and the Reopened 2034 Bonds are collectively referred to as the "new global bonds").

The Republic also announced that it will issue $200,000,000 in aggregate principal amount of New 2021 Bonds for cash (the "cash offering" and, together with the invitation, the "global bond offering").

The global bond offering commenced on September 20, 2010, on the terms and subject to the conditions described in the prospectus supplement dated September 20, 2010 (the "prospectus supplement") and the accompanying prospectus dated December 23, 2009 (the "prospectus"). The invitation expired at 5:00 P.M., New York City time, on September 28, 2010. The scheduled settlement date for the global bond offering is October 6, 2010 (the "settlement date").

The securities codes for the old bonds are:

         Series                  ISIN          CUSIP      Maturity Date
--------------------------  -------------   ---------- --------------------

Group A Bonds
--------------------------
8.375% Bonds due 2/15/2011   US718286AV96    718286AV9    February 15, 2011
 ("2011 Bonds")
9.000% Bonds due 2/15/2013   US718286AT41    718286AT4    February 15, 2013
 ("2013 Bonds")
8.250% Bonds due 1/15/2014   US718286AU14    718286AU1    January 15, 2014
 ("2014 Bonds")
8.875% Bonds due 3/17/2015   US718286AW79    718286AW7    March 17, 2015
 ("2015 Bonds")
8.000% Bonds due 1/15/2016   US718286BA41    718286BA4    January 15, 2016
 ("January 2016 Bonds")
8.750% Bonds due 10/7/2016   US718286AC16(1) 718286AC1(3) October 7, 2016
 ("October 2016 Bonds")      USY6972CAJ63(2)
9.375% Bonds due 1/18/2017   US718286AQ02    718286AQ0    January 18, 2017
 ("2017 Bonds")

Group B Bonds
--------------------------
9.875% Bonds due 1/15/2019   US718286AK32    718286AK3   January 15, 2019
 ("January 2019 Bonds")
8.375% Bonds due 6/17/2019   US718286BE62    718286BE6   June 17, 2019
 ("June 2019 Bonds")
7.500% Bonds due 9/25/2024   US718286BC07    718286BC0   September 25, 2024
 ("September 2024 Bonds")
9.500% Bonds due 10/21/2024  US718286AL15    718286AL1   October 21, 2024
 ("October 2024 Bonds")
10.625% Bonds due 3/16/2025  US718286AP29    718286AP2   March 16, 2025
 ("2025 Bonds")
9.500% Bonds due 2/2/2030    US718286AY36    718286AY3   February 2, 2030
 ("2030 Bonds")
7.750% Bonds due 1/14/2031   US718286BB24    718286BB2   January 14, 2031
 ("2031 Bonds")
--------------------------
(1) ISIN corresponding to restricted global bonds of this series.
(2) ISIN corresponding to Regulation S global bonds of this series.
(3) CUSIP corresponding to restricted global bonds of this series.

I. New Global Bond Terms

The New 2021 Bonds issued pursuant to the global bond offering will have the following terms:

--  Coupon: 4.000%
--  Final Maturity Date: January 15, 2021
--  Reference Yield: 2.541%
--  New Issue Spread: 1.55%
--  New Issue Yield: 4.091%
--  New Issue Price per $1,000 in principal amount: $992.48

The Republic expects to issue approximately $ 2,241,744,000 aggregate principal amount of New 2021 Bonds pursuant to the global bond offering, including approximately $2,041,744,000 aggregate principal amount of New 2021 Bonds pursuant to the invitation, and approximately $200,000,000 aggregate principal amount of New 2021 Bonds pursuant to the cash offering. The New 2021 Bonds will have a short first coupon, the first interest payment will be made on January 15, 2011, in respect of the period from (and including) the settlement date to (but excluding) January 15, 2011.

The Reopened 2034 Bonds issued pursuant to the global bond offering will have the following terms:

--  Coupon: 6.375%
--  Final Maturity Date: October 23, 2034
--  Reference Yield: 3.676%
--  Reopening Spread: 1.60%
--  Reopening Yield: 5.276%
--  Reopening Price per $1,000 in principal amount: $1,148.79

The Republic expects to issue approximately $949,615,000 aggregate principal amount of Reopened 2034 Bonds pursuant to the invitation. The Reopened 2034 Bonds will have a short first coupon, the first interest payment will be made on October 23, 2010, in respect of the period from (and including) the settlement date to (but excluding) October 23, 2010, and will be payable to the persons who are registered holders of the Reopened 2034 Bonds at the close of business on the settlement date.

The Reopened 2034 Bonds constitute a further issuance of, and on October 24, 2010 will become fungible with and be consolidated and form a single series with, the 6.375% Global Bonds due 2034 issued by the Republic on October 23, 2009 in the amount of $1,000,000,000 and reopened on January 13, 2010, in the amount of $850,000,000. Prior to October 24, 2010 the Reopened 2034 Bonds will bear different securities codes and trade separately from those previously issued 6.375% Global Bonds due 2034. Upon issuance, the Reopened 2034 Bonds will rank pari passu with the previously issued 6.375% Global Bonds due 2034 in all respects.

II. Results of Invitation

A total of $4,446,955,000 in principal amount of old bonds were submitted pursuant to the invitation.

(a) The old bond price and the old bond exchange value for each series of old bonds and the special cash payment amounts for each of the 2030 Bonds and the 2031 Bonds are listed in the table below:

                                 Fixed
                                Spread
                                 /Rela-                  Special
                       Reference  tive Exchange           Cash    Old Bond
                         Yield  Spread  Yield  Old Bond  Payment  Exchange
     Old Bonds            (%)     (%)    (%)    Price*      *      Value*
-------------------      ------ ------ ------ ---------- ------- ----------

Group A Bonds
-------------------

2011 Bonds                0.349   0.05  0.399 $ 1,028.52    0    $1,028.52

2013 Bonds                0.690   0.25  0.940 $ 1,187.53    0    $1,187.53

2014 Bonds                0.940   0.70  1.640 $ 1,209.89    0    $1,209.89

2015 Bonds                1.304   0.70  2.004 $ 1,290.94    0    $1,290.94

January 2016 Bonds        1.559   0.70  2.259 $ 1,283.93    0    $1,283.93

October 2016 Bonds        1.767   0.73  2.497 $ 1,346.57    0    $1,346.57

2017 Bonds                1.836   0.90  2.736 $ 1,380.80    0    $1,380.80

Group B Bonds
-------------------

January 2019 Bonds        5.276  -1.65  3.626 $ 1,443.19    0    $1,443.19

June 2019 Bonds           5.276  -1.55  3.726 $ 1,342.57    0    $1,342.57

September 2024 Bonds      5.276  -0.93  4.346 $ 1,310.17    0    $1,310.17

October 2024 Bonds        5.276  -0.73  4.546 $ 1,510.01    0    $1,510.01

2025 Bonds                5.276  -0.58  4.696 $ 1,616.74    0    $1,616.74

2030 Bonds                5.276  -0.18  5.096 $ 1,537.22 $207.00 $1,330.22

2031 Bonds                5.276  -0.16  5.116 $ 1,329.84 $167.00 $1,162.84
-------------------
*Per $1,000 in principal amount

(b) The exchange ratio, pro-ration factor, preliminary estimate of principal amount of each series of Group A Bonds accepted in exchange for New 2021 Bonds and preliminary estimate of principal amount of New 2021 Bonds issued in exchange are listed in the table below:

                                              Principal
                                            Amount of Old     Principal
                                            Bond Accepted   Amount of New
                 Exchange     Pro-Ration    for Exchange     2021 Bonds
                Ratio into    Factor for    into New 2021     Issued in
                 New 2021   Exchange into     Bonds (in      Exchange (in
  Old Bonds       Bonds        New 2021       thousands)      thousands)
-------------   ----------- --------------  --------------- ---------------

  2011 Bonds       1.0363        100%           $198,227        $205,422

  2013 Bonds       1.1965        100%           $144,437        $172,818

  2014 Bonds       1.2191        100%           $390,484        $476,039

  2015 Bonds       1.3007         75%           $264,757        $344,370

 January 2016
    Bonds          1.2937        100%           $605,380        $783,180

 October 2016
    Bonds          1.3568        100%            $44,158         $59,913

 2017 Bonds        1.3913         0%               $0              $0

(c) The exchange ratio, pro-ration factor, preliminary estimate of principal amount of each series of old bonds accepted in exchange for Reopened 2034 Bonds and preliminary estimate of principal amount of Reopened 2034 Bonds issued in exchange are listed in the table below:

                                              Principal
                  Exchange                  Amount of Old     Principal
                    Ratio     Pro-Ration    Bonds Accepted    Amount of
                    into      Factor for     for Exchange   Reopened 2034
                  Reopened  Exchange into   into Reopened   Bonds Issued in
                    2034    Reopened 2034   2034 Bonds (in   Exchange (in
  Old Bonds         Bonds       Bonds         thousands)      thousands)
-------------   ----------- --------------  --------------- ---------------
Group A Bonds
-------------

 2011 Bonds         0.8953       100%           $17,072         $15,284

 2013 Bonds         1.0337       100%            $4,092          $4,229

 2014 Bonds         1.0532       100%           $17,144         $18,056

 2015 Bonds         1.1237       100%           $11,370         $12,776

 January 2016
    Bonds           1.1176       100%           $86,893         $97,111

 October 2016
    Bonds           1.1722       100%           $21,589         $25,306

 2017 Bonds         1.2020       100%           $24,367         $29,289

Group B Bonds
-------------

 January 2019
    Bonds           1.2563       100%           $99,287        $124,734

June 2019 Bonds     1.1687       100%          $261,242        $305,313

September 2024
    Bonds           1.1405        0%              $0              $0

 October 2024
    Bonds           1.3144        0%              $0              $0

 2025 Bonds         1.4073       100%          $225,619        $317,513

 2030 Bonds         1.1579        0%              $0              $0

 2031 Bonds         1.0122        0%              $0              $0

(d) The aggregate principal amount of old bonds outstanding prior to the settlement of the global bond offering and the preliminary estimate of the aggregate principal amount of old bonds to be outstanding after the settlement of the global bond offering are listed in the table below:


                         Principal Amount
                           of Old Bonds                    Principal Amount
                           Outstanding                       of Old Bonds
                             prior to     Principal Amount   Outstanding
                          Settlement of     of Old Bonds   after Settlement
                         the Global Bond   Accepted into    of the Global
                           Offering (in     Exchange (in    Bond Offering
      Old Bond              thousands)       thousands)     (in thousands)
---------------------    ---------------- ---------------- ----------------
Group A Bonds
---------------------

   2011 Bonds               $1,484,215       $215,299         $1,268,916

   2013 Bonds                $948,383        $148,529          $799,854

   2014 Bonds               $1,601,622       $407,628         $1,193,994

   2015 Bonds                $976,414        $276,127          $700,287

January 2016 Bonds          $1,300,000       $692,273          $607,727

October 2016 Bonds           $629,703         $65,747          $563,956

   2017 Bonds                $822,381         $24,367          $798,014

Group B Bonds
---------------------

January 2019 Bonds           $962,468         $99,287          $863,181

 June 2019 Bonds            $1,500,000       $261,242         $1,238,758

September 2024 Bonds         $774,204            $0            $774,204

October 2024 Bonds           $480,406            $0            $480,406

   2025 Bonds               $1,854,744       $225,619         $1,629,125

   2030 Bonds               $2,000,000           $0           $2,000,000

   2031 Bonds               $2,384,506           $0           $2,384,506

The definitive amounts of new global bonds to be issued and old bonds to be exchanged remain subject to final confirmation by the information and exchange agent.

On the settlement date, each holder exchanging old bonds for new global bonds will receive a cash payment in respect of any accrued and unpaid interest on the old bonds accepted for exchange during the period from and including the last interest payment date with respect to such old bonds up to but not including the settlement date. Each holder exchanging old bonds for new global bonds may also receive at settlement an amount in cash in U.S. dollars due to rounding of the principal amount of new global bonds issuable to such holder downward to the nearest $1,000 (subject to minimum denominations of $100,000).

Application has been made to admit the new global bonds to listing on the Official List of the Luxembourg Stock Exchange and to trading on the EuroMTF Market. The Republic cannot guarantee that the application to the Luxembourg Stock Exchange will be approved and settlement of the new global bonds is not conditioned on obtaining the listings.

The invitation was made solely pursuant to the prospectus supplement and the prospectus. The prospectus and the prospectus supplement may be accessed through the following hyperlink: http://www.sec.gov/Archives/edgar/data/1030717/000119312510212607/d424b3.htm

The Republic has filed a registration statement (including the prospectus) and the prospectus supplement with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement (file no. 333-163671), the prospectus supplement filed pursuant to such registration statement, and other documents that the Republic has filed with the SEC for more complete information about the Republic and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the Republic, the joint dealer managers, or the information and exchange agent will arrange to send you the prospectus supplement and the prospectus if you request them by calling any of Citigroup Global Markets Inc. toll-free (in the U.S.) at (800) 558-3745, The Hongkong and Shanghai Banking Corporation Limited toll-free (in the U.S.) at (888) 472-2456, UBS AG toll-free (in the U.S.) at (888) 719-4210 and the information and exchange agent Bondholder Communications Group, LLC at (UK) +44 (0) 207 382 4580, (US) +1 (212) 809 2663 or toll free (in the U.S.) at +1 (888) 385 2663, or you may download the prospectus supplement and the prospectus at the invitation website www.bondcom.com/rop.