PNB raises $300M from medium-term note issue at 4.25%

THE Philippine National Bank (PNB) raised $300 million from the issue of medium-term notes, which met with strong demand from foreign investors, it said on Friday.
In a disclosure, PNB said it issued $300 million in fixed-rate senior notes under the first tranche of the bank’s Euro medium term note (MTN) programme.
“Proceeds of the Notes will be used for general corporate purposes,” the bank, controlled by Lucio C. Tan, told the Philippine Stock Exchange.
The decision to tap global capital markets broadens the base for fund-raising. The notes are offered on a continuing basis until the ceiling is reached.
Other banks are also raising funds ahead of higher capital and liquidity requirements required by the central bank by 2019 to comply with the Basel 3 rules.
This issue marks the maiden drawdown from PNB’s $1-billion MTN programme announced earlier this month.
The notes were priced at 4.25% with a tenor of five years and a day.
The notes were issued at a minimum of $200,000 plus increments of $1,000, to be settled by April 26. Tenders received amounted to nearly $1.2 billion, or four times the amount which the bank planned to raise.
The bank staged roadshows for Singapore and Hong Kong investors from April 16-18. The notes will mature by April 27, 2023 and will be listed on the Singapore Stock Exchange.
Some 86% of bidders came from within Asia, while 14% were from Europe, the Middle East and Africa, PNB said. Most were asset and fund managers.
Citigroup, MUFG, Standard Chartered Bank and Wells Fargo Securities were joint arrangers, lead managers and bookrunners for the issue.
Moody’s Investors Service has assigned an investment-grade rating to PNB’s note issuance to match the Baa2 rating of the Philippine government.
Moody’s said the rating reflects the assumption that PNB “will receive support from the Government of the Philippines (Baa2 stable) in times of need.”
PNB is the fifth-biggest bank in terms of assets as of 2017. The bank booked an P8.2-billion net profit in 2017, up 14%, supported by strong growth in its core operating income.
PNB closed at P54.10 , up from P53 on Thursday. — Melissa Luz T. Lopez