Retail Dollar Bonds

RDBs are medium- to long-term debt securities issued by the Republic of the Philippines (“ROP” or “the Republic”) through the Bureau of the Treasury (“BTr”). The RDBs are part of the government’s savings mobilization program designed to make government securities available to retail investors; hence, the name Retail Onshore Dollar Bonds. RDBs are fixed-income securities that pay a fixed interest rate per annum over a specified period of time with a promise to return the principal at the end of the term.

Investing in RDBs is considered safe and low-risk because they are a direct obligation of the Philippine government and thus backed by the entire financial capacity of the Republic. As an investment security, RDBs have inherent risks like market or price risk, foreign exchange risk, default risk and sovereign risk, however, these risks are minimized due to the financial backing of the Republic. Thus, it is highly recommended that the investor should understand all the risks involved before investing in RDBs.

Depending on the prevailing market rates at the time of the sale, there is a possibility that the resulting net proceeds may be higher or lower than the principal investment. Should the investor decide to convert their USD to PHP, there will be exposure to foreign exchange risk as well.

The Issuer would like to extend the maturity profile of its borrowings. As such, a 5 and 10-year tenor are in line with the BTr’s liability management program.

No, since the issuer is the NG itself, thus it can’t guarantee itself. The RDBs are direct and unconditional obligations of the NG, which rank in equal footing with all other obligations of the NG. The interest payments and eventual return of the principal is backed by the entire financial capacity of the Republic to pay off all its debt.