China Bank raises P30B via fixed-rate peso bonds

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CHINA BANKING Corp. has raised P30 billion in fresh funds.

CHINA BANKING Corp. (China Bank) raised P30 billion via its maiden fixed-rate bond offering to boost funding flexibility.

China Bank’s communications team said in a text message on Monday that the Sy-led bank raised P30 billion in 1.5-year peso-denominated debt papers, upsized from the initial target of P5 billion.

The one-and-a-half year debt papers carry an interest rate of 5.7% per annum to be paid on a monthly basis until January 2021.

The bonds will be listed on the Philippine Dealing & Exchange Corp. on July 10.

The bonds offered from June 10-28 mark the first tranche of China Bank’s P75-billion fund-raising program for the next three years intended to support expansion and strategic initiatives.

“We aim to provide retail investors with a good investment opportunity and enhance public participation in the capital markets while increasing our funding flexibility,” China Bank Chief Operating Officer Romeo D. Uyan, Jr. was quoted as saying in a statement released in June.




The lender added that its plan to issue debt papers onshore is also in line with its intention to participate in the country’s economic growth and help fund the government’s infrastructure push.

The Hongkong and Shanghai Banking Corp. Ltd. and Standard Chartered Bank served as joint lead arrangers for the transaction. The foreign banks also acted as selling agents alongside China Bank, China Bank Capital and Amalgamated Investment Bancorporation.

Last week, China Bank announced it will raise up to P20 billion through the issuance of long-term negotiable certificates of deposit (LTNCD) to support asset generation and expansion.

Like regular time deposits offered by banks, LTNCDs offer higher interest rates. However, LTNCDs cannot be pre-terminated but can be sold on the secondary market, making them “negotiable.”

The bank booked a P1.9-billion net income in the first quarter, up 24% year-on-year, driven by robust expansion of its core businesses.

Shares in China Bank closed at P27.15 apiece on Monday, flat from the previous day’s finish. — Karl Angelo N. Vidal