By Karl Angelo N. Vidal, Reporter
PHILIPPINE NATIONAL Bank (PNB) is set to offer about P5 billion in peso-denominated bonds, with the amount raised to be used to support lending activities and diversify funding sources.
In a regulatory filing on Monday, the Lucio C. Tan-led lender said it will raise P5 billion, with the option to upsize, through two-year peso fixed-rate bonds.
The two-year bonds will be offered until April 30 and carry an interest rate of 6.3% per annum to be paid quarterly until 2021.
The bonds, which will not be insured by the Philippine Deposit Insurance Corp., will be listed at the Philippine Dealing & Exchange Corp. on May 8.
The notes will be sold in denominations of P100,000 and in increments of P50,000 thereafter.
“Purpose of the bonds is to support the bank’s lending activities and diversify its funding sources,” Nelson C. Reyes, PNB executive vice president and chief financial officer, said in a text message.
The local currency bonds to be offered make up the first tranche of PNB’s P100-billion program approved by its board of directors in January.
“PNB and sole arranger reserve the right to adjust the offer period and issue date,” the bank said.
The fifth-largest lender in asset terms tapped Standard Chartered Bank as the sole arranger and bookrunner of the capital-raising activity. It will also act as a selling agent alongside PNB.
Lenders can now raise fresh funds through corporate bonds with greater ease as new rules do away with having to secure approval from the Bangko Sentral ng Pilipinas.
In February, PNB issued P8.22 billion worth of 5.5-year long-term negotiable certificates of deposit, with the raised funds to be used to extend the bank’s maturity profile. The instruments carry an interest rate of 5.75% per annum.
Last week, the bank announced its plan to raise P12 billion through a stock rights offering to “strengthen its common equity Tier 1 and enable the bank to sustain its asset growth.”
PNB posted a P9.6-billion net income in 2018, up 17% from P8.2 billion booked the previous year, driven by its core businesses.
Shares of the lender closed at P53.50 apiece on Monday, down P3.15 or 5.56% from the previous day.