Metrobank launches notes

Metropolitan Bank and Trust Co. (Metrobank) has started to offer lower Tier 2 peso-denominated step-up callable subordinated notes (LT2) worth P5 billion.  Moody’s Investors Service has assigned a Baa3 rating to the issue. 

Metrobank had previously received Bangko Sentral ng Pilipinas (BSP) approval to issue up to P10 billion in LT2 Unsecured Subordinated Notes.  

The offer period started yesterday and the issue date for the LT2 Notes is in the third week of October. ING Bank and Standard Chartered Bank are the joint lead arrangers, bookrunners, selling agents, and market-makers for the issue. Multinational Investment Bank Corp. is also one of the selling agent while Metrobank and First Metro Investment Corp. are limited selling agents.

The LT2 Notes will have a maturity date of 10 years from the issue date, with a call option at the end of the fifth year, subject to a step-up interest rate feature. Metrobank may redeem the Notes in whole, but not in part, at a price equal to 100 percent of the principal plus accrued and unpaid interest at the end of the fifth year subject to approval of the BSP.

The minimum investment is P500,000, and in blocks of P100,000 thereafter.  The indicative coupon rate is seven percent, and interest payments will be made quarterly.

Lower Tier 2 capital is classified as supplementary capital packaged as an interest-bearing note with a limited tenor of at least five years.   —Ted Torres