Pag-IBIG launches P12-billion bond sale

State-administered Home Development Mutual Fund (HDMF), also known as Pag-IBIG Fund, launched its P12-billion bond offer on Tuesday, to be off auctioned to the public on March 9. HDMF Chief Executive Officer Jaime Fabiaña said proceeds of the borrowing would be used to pay off P7 billion worth of debt maturing in May .The balance will be used to augment the agency’s funds. In an investors’ briefing on Tuesday, Fabiaña said the bonds have enough sweeteners, making it an attractive investment. "They are tax-free and enjoy the full and unconditional guarantee of the government through the Home Guaranty Corporation," he pointed out. The bonds, which will mature in five years, also serve as alternative compliance by banks with the law requiring them to lend to agriculture, and counts as reserve assets of insurance companies and compliance with the Urban Housing Development Act. The bond is targeting banks, property developers and insurance companies. Pag-IBIG has tapped state-owned Development Bank of the Philippines (DBP) and First Metro Investment Corp., the investment banking arm of the Metrobank Group, as arrangers of the deal. Land Bank of the Philippines joins the DBP and First Metro as joint lead underwriters, while the Treasury bureau will serve as a facility agent and registrar. Pag-IBIG is the state-owned agency that provides affordable home financing to members. It also provides personal and other emergency loans. Last year, the fund lent P46 billion to more than 74,000 members nationwide, making it the country's biggest home financier. — NPA, GMANews.TV