PNB raises P8.2 billion from LTNCD issuance

MANILA, Philippines — Tan-led Philippine National Bank (PNB) raised P8.22 billion via the issuance of long-term negotiable certificates of time deposits (LTNCDs) due 2024 as part of a series of fund raising activities lined up by the bank.

The debt instrument with a tenor of five years and six months fetched a coupon rate of 5.75 percent per annum.

PNB president and chief executive officer Jose Arnulfo Veloso said the fund raising activity would help extend the bank’s maturity debt profile and raise long-term funds to support its loan growth.

“This is a strategic exercise for us as we continue to grow our loan portfolio. Raising long term funding at attractive levels offers our investors an opportunity to support our goals, while allowing us to also provide cost-competitive loans to our clients who would like to grow alongside our strong Philippine economy,” Veloso said.

It was the largest LTNCD issuance by PNB. It was 2.7 times oversubscribed as the initial plan was to raise only P3 billion.

“This is due to strong investor demand from both retail and institutional investors,” he said.

HSBC and ING were joint lead managers on the transaction, and were likewise selling agents alongside PNB, First Metro Investment Corp. (FMIC) and Multinational Investment Bancorp. PNB Capital and Investment Corp. served as advisor.

The country’s fifth largest lender announced last year it would raise P20 billion through the issuance of LTNCDs to extend the maturity profile of the bank’s liabilities as part of overall liability management.

Proceeds of the fund raising activity would help the bank comply with the liquidity ratios required by the Bangko Sentral ng Pilipinas (BSP).

PNB has issued P22.495 billion worth of LTNCDs since 2014. It issued P7 billion in December 2014, P5.38 billion in December 2016, P3.765 billion in April 2017, and another P6.35 billion in October 2017.