PNB eyes P20 billion bonds, appoints new president

MANILA, Philippines — Philippine National Bank (PNB) is raising as much as P20 billion via the issuance of peso-denominated bonds, as it announced the appointment of banker Jose Arnulfo Veloso as the bank’s new president and CEO starting Nov. 16.

In a disclosure to the Philippine Stock Exchange (PSE), the Lucio Tan-led bank said its board of directors approved the fund-raising activity through the issuance of peso-denominated bonds in one or more tranches.

PNB laid down various lending activities, tapping both the offshore and onshore markets to raise long-term funds and at the same time support compliance with the required liquidity ratios mandated by the Bangko Sentral ng Pilipinas (BSP).

Last April, it raised $300 million from the issuance of fixed rate senior notes under its $1 billion euro medium term note (EMTN) program.

Likewise, PNB also announced last January it would raise as much as P20 billion through the issuance of long term negotiable certificates of deposits (LTNCDs) to extend the maturity profile of the bank’s liabilities as part of overall liability management, support compliance with required BSP liquidity ratios.

PNB has issued P22.495 billion worth of LTNCDs over the past three years. It issued P7 billion worth of LTNCDs due 2022 last December 2014 and another P6.35 billion worth of LTNCDs due 2023 in October last year.

The BSP expects a shift to bonds and commercial papers instead of LTNCDs as the primary source of fund raising activity for Philippine banks.

Meanwhile, the bank announced the appointment of Veloso as its new president and CEO replacing 80-year old Reynaldo Maclang who is scheduled to retire on Nov. 15.

Veloso, 52, was the first Filipino CEO for the local unit of HSBC in its more than 140 years of operations in the Philippines. He replaced former HSBC president and CEO Tony Cripps in December 2013.

On the other hand, Maclang was appointed president and CEO of PNB in May 2014.

Earnings of PNB more than doubled to P5.4 billion in the first half from P2.7 billion in the same period last year on the back of the strong performance of its core businesses as well as higher non-recurring revenues.

The Tan-led bank booked a net gain of P4.4 billion from the disposal of foreclosed properties as a result of its continuing strategy of reducing non-earning assets.

PNB has more than 690 branches and 1,240 ATMs nationwide. It has the most extensive international footprint with more than 70 overseas branches, representative offices, remittance centers and subsidiaries across Asia, Europe, the Middle East, and North America.