UnionBank launches P10 billion bond offering

MANILA, Philippines — Union Bank of the Philippines is offering up to P10 billion in bonds, consisting of two fixed-rate tranches under its updated P100-billion bond program, to strengthen its capital base and support business expansion.

In a disclosure to the Philippine Stock Exchange, the Aboitiz-led bank said the offering would consist of the 1.5-year senior fixed rate Series H bonds due in 2026, and the three-year senior fixed rate Series I bonds due in 2028.

The interest rates for the two tranches are set at 5.88 percent per annum for the Series H bonds and 6.02 percent per annum for the Series I bonds.

UnionBank has set a minimum aggregate principal amount of P5 billion per tranche, with an oversubscription option. Investors can participate by purchasing the bonds from June 4 to June 19. The bonds will be listed on the Philippine Dealing & Exchange Corp. on June 26.

The bonds come with a minimum investment amount of P100,000 per bond, with subsequent multiples of P50,000, making them accessible to a range of retail and institutional investors.

The issuance is part of UnionBank’s ongoing capital-raising initiatives and is being executed under the bank’s updated P100-billion bond program, which was approved by its board of directors in February.

Joint lead arrangers and bookrunners for the offering include ING Bank N.V., Manila Branch, Philippine Commercial Capital, Inc. and Standard Chartered Bank, which will also serve as selling agents alongside UnionBank.

The bonds are being offered in compliance with the Securities Regulation Code, with future offers or sales subject to registration requirements, unless exempt.

In December 2023, UnionBank raised P18.17 billion from the successful dual tranche offering of peso-denominated fixed rate bonds under the then P50-billion bond program.

UnionBank raised P10.34 billion from the issuance of 1.5-year Series F bonds due 2025 with an interest rate of 6.5625 percent per annum. It also raised another P7.83 billion via the issuance of three-year Series G bonds due 2026 that carries an interest rate of 6.68 percent per annum.

Strong demand from both retail and institutional investors enabled the bank to upsize the issuance to over nine times its initial minimum offer size of P2 billion for the two tranches.