Security Bank closes offer early for P5-B LTNCDs

MANILA, Philippines -  Security Banking Corp. said strong demand for its P5-billion, seven-year long term negotiable certificates of deposits (LTNCDs) forced it to close the offer ahead of its original closing of Feb. 10.

LTNCDs are negotiable certificates of deposit indicating an amount of indebtedness of a bank with a designated maturity. The LTNCDs form part of a bank’s deposits, are insured with the Philippine Deposit Insurance Corp. (PDIC), and rank senior to all unsecured and subordinated debts, and all classes of equity securities.

The issue date for the LTNCDs is on Feb. 17, 2012.

Security Bank senior vice president and treasurer Raul Pedro said there is strong demand in the market for alternative investment instruments that could deliver higher yields.

He added that the offer, the first seven-year LTNCD issue in the country, would raise funds “to find growth in assets and extend maturity profile of liabilities.”

Deutsche Bank AG Manila Branch and Standard Chartered Bank are the joint lead arrangers and selling agents for the transaction. Multinational Investment Bancorporation also acted as selling agent. 

Security Bank registered a net income of P6.7 billion and a return on equity (ROE) of 25 percent 2011.

Total assets expanded 30 percent to P215 billion, while its loan portfolio improved 24 percent to P92 billion due to strong credit demand in the top corporate and middle market segments.

With the asset growth from loans and investments, net interest income likewise grew 24 percent to P7.5 billion, resulting in a net interest margin of 4.1 percent.

Last year, Security Bank acquired Premiere Development Bank, a thrift and development bank.