RCBC sells P3.85-billion notes

MANILA, Philippines - Rizal Commercial Banking Corp. (RCBC) has raised P3.85 billion worth of long-term negotiable certificates of time deposit (LTNCD) as it continues to build its war chest for strategic acquisitions and long-term asset growth.

“The net proceeds will be used to expand its long-term deposit base, support long-term asset growth, and for other general funding purposes,” the bank said in a report.

RCBC president and chief executive officer Lorenzo V. Tan had said that the bank would support its expansion by adding more branches as well as through acquisition.

RCBC is reportedly in talks with a major thrift bank for possible merger. In the past two years, the commercial bank of the Yuchengco Group preferred to acquire smaller commercial banks and major thrift banks in its bid to expand.

Of the total amount of the LTNCD raised, P2.033 billion are in fixed-rate form and P1.817 billion in face value of zero-coupon LTNCDs.

RCBC executive vice president and corporate information officer Elbert M. Zosa explained that the fixed rate coupon carries an interest rate of 5.25-percent per annum, while the zero coupon were priced at a yield of 5.5 percent. The LTNCDs will mature on June 2017.

Deutsche Bank AG and ING Bank NV were the joint lead arrangers and selling agents. Multinational Investment Bancorporation also acted as additional selling agent and market maker.

Last year, RCBC also sold P5 billion worth of LTNCDs with a maturity period of five years. It was the first time in the Philippines that coupon-bearing and zero-coupon LTNCDs were offered simultaneously.

The coupon-bearing LTNCDs carried a rate of 6.5 percent per annum and issued at 100 percent face value. The zero-coupon LTNCDs carried a yield-to-maturity of 6.75 percent per annum, at 69.2 percent face value.