| Type |
Fixed Rate Yen Bond cofinancing supported by ADB Partial Credit Guarantee |
| Borrower |
Power Sector Assets and Liabilities Management Corporation (PSALM) |
| Cofinanced Amount |
Up to $500 million equivalent in Japanese yen bonds |
| Term |
Two tranches of 18 and 20 years |
| Guarantee Structure |
ADB PCG will cover 100% of the repayment of the principal at final maturities, plus partial coverage of up to 10 years of the back-end interest coupons. Republic of the Philippines guarantee will cover 100% of the repayment and interest payments of the bond through direct guarantees. |
| Counterguarantee |
Republic of the Philippines (ROP) |
| Use of Proceeds |
To meet the cash flow requirements during the initial stage of privatization. |
| Remarks |
ADB's PCG was vital for the successful execution of PSALM bond issue at the end of 2002, when world capital markets were very volatile. With the PCG, PSALM was able to borrow at significantly more favorable terms to extend the term by 11-13 years over an ROP stand-alone bond issue. This transaction was the largest-ever bond issue assisted by an ADB PCG.
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