BPI sets investor meetings in Hong Kong, Singapore for $2 billion offshore borrowing

MANILA, Philippines — Ayala-led Bank of the Philippine Islands (BPI) is holding a series of meetings with fixed income investors in Hong Kong and Singapore starting today as part of its plan to raise $2 billion from the offshore debt market.

The 167-year old bank has mandated BPI Capital as sole global coordinator and joint bookrunner as well as Deutsche Bank, HSBC, and JP Morgan as joint bookrunners to arrange the meetings.

“A Regulation S offering of dollar-denominated senior unsecured debt securities may follow, subject to market conditions,” BPI said.

The medium term note program in the aggregate amount of $2 billion or its equivalent in other currencies was successfully established by BPI last June 21.

BPI said the fund raising activity is part of its initiatives to maximize flexibility in accessing funding expediently.

BPI’s asset base booked a double-digit growth of 10.4 percent to P1.91 trillion as of end-March, while its capital rose by 10.3 percent to P189.54 billion. This translated to a capital adequacy ratio of 13.55 percent and a common equity tier-1 ratio of 12.65 percent.

It recently raised P50 billion from a stock rights offering. Proceeds would be used to fund BPI’s growth strategy.

Earnings of BPI slipped by 5.7 percent to P11.03 billion in the first half from P11.7 billion in the same period last year due primarily to reduced non-interest income arising from lower trading gains.

Total revenues went up by 5.44 percent to P37.22 billion in the first six months from P35.3 billion in the same period last year, driven by strong growth in net interest income.

The bank’s loan book grew nearly 16 percent to P1.22 trillion from P1.1 trillion, driven primarily by strong growth in corporate loans and credit cards at 17.1 percent and 22.7 percent, respectively.

On the other hand, its deposit base climbed 7.2 percent to P1.53 trillion from P1.4 trillion with current and savings accounts (CASA) registering faster growth at 10 percent.

BPI said lower income from securities trading, trust and investment management and assets sales contributed to a 6.9 percent year-on-year decline in total non-interest income to P11.01 billion in the first half from P11.82 billion in the same period last year.

It likewise registered higher revenue from credit card fees and rental income.

Operating expenses rose by more than 16 percent to P21.22 billion from P18.3 billion on accelerated spending on manpower, premises and technology.

At the end of the first half, its total resources rose by nearly 11 percent to P1.9 trillion, while its capital surged 38.2 percent to P239.7 billion.