The expected volume would come from initial public offerings, follow-on share sales and private placements. That might rise further if plans to introduce exchange-traded funds (ETFs) and securities lending in the second half of the year are achieved, said Hans Sicat, the exchange’s president.

“We think that, barring any negative externalities, we’re probably close to doubling ... Our estimate is about 197 billion pesos of new fundraising in the capital market,” Sicat, a former investment banker, said.

Capital raised on the PSE last year hit a peak of 107.5 billion pesos, with the local market ending 2011 as Asia’s best performer, with a 4 percent gain.

On Monday, conglomerate GT Capital Holdings, which owns the country’s second largest lender by assets, Metropolitan Bank & Trust Co, said it was planning a public offer of as much as $577 million this year.

That followed the announcement of medium-sized lender East West Banking Corp. of the Filinvest group in January that it might raise $153 million.

The bourse has been hitting new highs almost every week since the middle of January, fueled by strong foreign fund inflows. Manila is the third-best performer in Southeast Asia so far this year.

Net foreign buying on the local bourse in the first six weeks of the year totalled 15 billion pesos, reversing a net outflow of 6.6 billion pesos in the same period of 2011, data from the stock exchange show.

Daily average turnover in the first six weeks of 2012 was 7.8 billion pesos, 50 percent higher than a year ago.

“The mood in general seems to be one of optimism in the country’s prospects as a general macro-economy,” said Sicat. 

“And more importantly, in terms of the development and ability of various companies to actually weather any storm.”

The stock exchange is working with the securities regulator to introduce around the end of June rules for securities lending, which could increase volume of trades in the market by at least 10 percent initially, Sicat said.

“We’re among the last two or three exchanges in the world which do not have an SBL (securities-borrowing and lending), or a workable SBL,” he said.

“It is a building block that is necessary ... The ability to borrow stock is the basis for hedging, is the basis for basic portfolio management and, as a result, the ability to create ETFs,” he said.

ETFs are funds that track an index, a commodity, or a basket of assets but trade like a stock on a stock exchange.

Sicat said some local banks were working to launch ETFs this year once the securities regulator clears rules allowing trading of the instruments in the second quarter. 

“There will probably be at least two or three local ETFs that will immediately launch,” he said.