PNB concludes 2nd LTNCD offering

MANILA, Philippines - The Philippine National Bank (PNB) has successfully concluded its second long term negotiable certificates of time deposits (LTNCD) offering in 2013. 

PNB president and CEO Omar Mier said the second LTNCD offering was done to address the unmet demand from its customers after PNB’s first issuance in July was oversubscribed just a few hours into the offer. 

“We did not expect such an overwhelming demand for our LTNCDs during our first issuance, which carried the lowest ever coupon rate of its kind.This prompted us to issue a second tranche of LTNCDswhich has proven equally successful. The robust appetite for PNB’s issuances shows our growing competitiveness in the local market,” Mier said.

The proceeds of the second offering will be used for general corporate purposes and to further strengthen banking operations.

LTNCDs are negotiable certificates of time deposit with a designated maturity or tenor representing a bank’s obligation to pay the face value upon maturity as well as make periodic coupon or interest payments during the life of the deposit. 

Additionally, LTNCDs are insured by the Philippine Deposit and lnsurance Corporation (PDIC) for up to P500,000 and are tax exempt for qualified individuals if held for at least five years.

PNB was able to raise P4 billion from the second issuance of LTNCDs. The LTNCDS carry a maturity of five and a half years and have a coupon of 3.25 percent per annum. 

The public offer period ran from Oct. 9 to 16, 2013. The issue date will be on Oct. 21, 2013.

The Hongkong and Shanghai Banking Corp. Limited (HSBC) acted as the sole lead arranger and selling agent of the issuance. 

ln addition to HSBC and PNB, First Metro lnvestment Corp. (FMIC) and Multinational lnvestment Bancorporation (MlB) also acted as selling agents while Deutsche Bank AG, Manila Branch acted as registry and paying agent.

HSBC Philippines president and CEO Wick Veloso said, “It is not often that we see a bank such as PNB offer two LTNCD tranches in one year.”

“The fact that both issuances were executed successfully is a testament to the growth of PNB and the support given to them by customers and investors,” Veloso added.

PNB is now the fourth largest privately owned bank in the Philippines, following its recent merger this year with Allied Banking Corp.