UNIONBANK OF THE Philippines, Inc. is set to redeem P7.2 billion worth of unsecured subordinated notes on Feb. 20 as it has exercised its call option for the papers.
The bank said in a disclosure on Monday that the papers eligible as Tier 2 capital, which are due to mature on Feb. 20, 2025, will be redeemed five years ahead of schedule by the exercise of its call option by way of voluntary redemption.
The notes were issued on Nov. 20, 2014 and carry a rate of 5.375%.
UnionBank said the exercise of the call option was approved by the Bangko Sentral ng Pilipinas on Dec. 19.
The bank had said in August last year that it was planning to redeem the unsecured notes ahead of schedule.
The lender said noteholders will be paid 100% of the face value of the notes.
In addition, they will get the accrued interest covering the 21st interest period at the rate as of, but excluding the redemption date to all noteholders as of Feb. 6, which is the book closure date for the papers.
“Upon the exercise of the voluntary redemption option, UnionBank shall shoulder the tax due, if any, on the interest income already earned by noteholders,” the bank said in a notice attached to its filing with the local bourse.
The bank said the principal or interest payments will be based on records of the registrar of Deutsche Bank AG, Manila Branch-Investors Services.
UnionBank’s net profit grew 40% year on year to P8.5 billion in the first nine months of 2019.
The Aboitiz-led lender ended trading at P58.45 apiece on Monday, up by 1.3% for 75 centavos from its close on Friday. — LWTN