BANK of the Philippine Islands (BPI) said it began offering on Friday the first tranche of a long-term note issue worth P5 billion to help expand its capital and diversify funding sources.
In a disclosure, BPI launched the first tranche of its P30 billion worth of Long-Term Negotiable Certificates of Time Deposit (LTNCTD), raised within a year.
The first tranche will be offered until Nov. 16, with the issue and listing dates set for Nov. 24.
The LTNCTD will be offered in five- and five-and-a-half-year tenors, with indicative interest rates of 3.625% and 3.750%, respectively.
The minimum investment amount is set at P100,000, with increments of P50,000. ING Bank Manila Branch will arrange the deal, and will act as selling agent with BPI and BPI Capital Corp.
Unlike regular time deposits, LTNCTDs cannot be pre-terminated by holders. However, the securities trade on the secondary market prior to maturity.
“We continue to diversify our funding sources as we cater to the changing financial needs of our clients,” BPI President and Chief Executive Officer Cezar P. Consing said.
The LTNCTD offering will be the second for BPI. The first offering was conducted in 2007.
“[W]e are confident that with the attractive yield, relative safety, and flexibility of the LTNCTDs, we will have the same success with our latest offer,” Mr. Consing added.
Other big banks are also considring offers of long-term debt paper to investors. The Philippine National Bank, Security Bank Corp., Union Bank of the Philippines, and the Metropolitan Bank & Trust Co. have also rolled out note offerings.