PHILIPPINE BANK of Communications (PBCom) raised P2.9 billion from its offer of long-term negotiable certificates of deposit (LTNCD), which will be used to support its long-term funding business.
At the ceremonial listing on Monday at the Philippine Dealing & Exchange Corp. (PDEx) in Makati City, the Co-led PBCom said it raised P2.903 billion from the peso-denominated issuance.
The notes will mature in 5.5 years and carry an interest rate of 5.625% to be paid quarterly until 2024.
The issuance is the maiden bond offer of the bank, and makes up the first tranche of its P5-billion LTNCD program approved by the central bank last July.
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.”
PBCom President and Chief Executive Officer Patricia May T. Siy said the additional capital raised from the LTNCD offering will be used to support the bank’s long-term lending business.
“The funds that we have raised will all be used to fund PBCom’s focus in our long-term lending activities for both corporate and consumer markets,” Ms. Siy said in her speech.
She added that the lender is “opportunistic” on its loan growth as it has outpaced the industry average for the past few years.
“We actually don’t target a specific number. [In our case], we’re always opportunistic. When there is a good project, we take a look at it,” she told reporters after the listing ceremony.
ING Bank N.V.-Manila branch and Development Bank of the Philippines served as joint lead arrangers and bookrunners of the offer. These lenders acted as selling agents for the offer alongside PBCom.
PBCom’s listing brings the total volume of outstanding securities listed at the PDEx to P935.97 billion, floated by 48 companies.
A number or banks have been raising additional capital ahead of tighter risk management requirement by the central bank which will take effect next year under the international Basel 3 standards.
Metropolitan Bank & Trust Co. as well as Rizal Commercial Banking Corp. have also offered LTNCDs to support their funding needs, raising P8.68 billion and P3.58 billion, respectively.
PBCom posted a P146.3-billion net income in the second quarter, declining by 20% from the P183.8 million tallied a year ago.
Shares in PBCom closed at P24.70 apiece on Monday, up P4.25 or 20.78%. — Karl Angelo N. Vidal