PBCom raising P5 billion from LTNCD offer

MANILA, Philippines — Listed Philippine Bank of Communications (PBCom) is raising as much as P5 billion from the issuance of long-term negotiable certificates of deposits (LTNCDs) to beef up its long term funding.

In a disclosure to the Philippine Stock Exchange (PSE), PBCom said its executive committee approved the fund raising activity through the LTNCD offering to be undertaken in one or more tranches.

 “The purpose of the issuance is for general corporate funding, especially long term funding,” the bank said.

The planned LTNCD offering of PBCom is still subject to the approval of the Bangko Sentral ng Pilipinas (BSP).

The issuance of LTNCDs has been an effective way for banks to raise cost-effective funding, while offering a new investment product to their own deposit base, most of whom are looking for long term assets that provide higher yields than traditional time deposits.

Banks that have so far issued LTNCDs this year include BDO Unibank Inc. with P8.2 billion, Security Bank Corp. with P5.78 billion, and Union Bank of the Philippines with P3 billion.

Earnings of PBCom ownd by businessman Lucio Co jumped by 32.4 percent to P176.9 million in the first quarter of the year from P133.6 million in the same quarter last year.