RCBC starts Tier 2 notes offering

MANILA, Philippines - Yuchengco-led Rizal Commercial Banking Corp. (RCBC) started yesterday the public offering of its Basel III-compliant unsecured subordinated Tier 2 notes.

The offer period will run until June 20, with issue date on June 27.

The notes will have a term of 10 years and three months, with an issuer’s early redemption option after five years and three months.

Investors may purchase the Tier 2 notes in minimum denominations of P500,000, in  increments of P100,000.

Deutsche Bank AG, Manila Branch is acting as sole arranger, book runner and selling agent, with additional selling agent Multinational Investment Bancorporation and RCBC as limited selling agent.

RCBC is issuing the Tier 2 notes to strengthen its capital base and capital adequacy ratio (CAR), to support asset growth, as well as expand its long-term funding base, especially in light of the Basel III requirements which took effect Jan.1, 2014.

As of March 31, 2014, RCBC is the fifth largest private domestic commercial bank in the Philippines in terms of total assets.

The bank has a market capitalization of P60 billion, and Basel III-compliant Tier 1 CAR and total CAR of 10.72 percent, 11.31 percent, respectively.

International credit rater Moody’s Investors Service has recently revised the outlook on the D – standalone bank financial strength rating (BFSR) of RCBC – equivalent to a baseline credit assessment (BCA) of ba3 - to positive from stable.