MANILA, Aug 19 (Reuters) - The Philippines said on Tuesdayit has sold and exchanged a total of 140.3 billion pesos ($3.2billion) worth of new 2024 bonds in a transaction that stretchedits average debt maturity profile, the latest in its liabilitymanagement programme.
Over 200 billion pesos worth of existing eligible bonds wereoffered under the domestic debt swap exercise, but the Treasuryaccepted only around 122 billion pesos of the eligible debtpapers, translating to about 131 billion pesos worth of newbonds, said HSBC, one of the government's deal managers.
Manila also raised around 9.4 billion pesos from the sale ofnew bonds of the same 10-year maturity, with a coupon rate of4.125 percent, higher than the PDST-R1 rate of 4.05 percent inthe secondary debt market.
With the transaction, the government will save about 1.3billion pesos from interest costs in the first year of the debtswap, and the average coupon of bonds accepted in the debtexchange will be stretched by 5.2 years.
"This domestic liability management exercise gave ourinvestors the avenue to exchange illiquid bonds with newbenchmark bonds which will trade more efficiently in the debtmarkets," Finance Secretary Cesar Purisima said in a statement.
HSBC and Land Bank of the Philippines were jointglobal coordinators, and joint dealer managers for the bond salealong with BDO Capital & Investment Corporation, BPICapital Corporation, Development Bank of thePhilippines and First Metro Investment Corporation.
The Philippines' debt liability programme and its preferencefor domestic debt over foreign borrowing has helped bring downdown national government debt to about 49 percent in 2013 fromaround 55 percent in 2009.
The country's gains in turning around its fiscal positionwas rewarded with a first ever upgrade to investment gradecredit rating by all three major debt watchers last year.
(1 US dollar = 43.67 Philippine peso) (Reporting by Rosemarie Francisco and Karen Lema; Editing bySimon Cameron-Moore)