PNB kicks off P5 billion bond offer

MANILA, Philippines — Philippine National Bank (PNB) offered yesterday two-year peso denominated fixed rate bonds as part of a P100-billion fund raising activity involving the issuance of bonds and commercial papers.

The bonds due in 2021 carried a rate of 6.3 percent per annum.

The bank is looking at raising at least P5 billion with an option to upsize as the offer period is until April 30.

Standard Chartered Bank is the sole arranger, bookrunner, and selling agent, while PNB is also acting as selling agent.

PNB’s board of directors approved the establishment of a peso bonds and commercial paper program amounting to P100 billion to be issued in one or more tranches.

The bank has been tapping the onshore debt market to raise long-term funds and comply with the required liquidity ratios mandated by the Bangko Sentral ng Pilipinas (BSP).

For one, it is raising P12 billion through the sale of shares to existing shareholders led by the LT Group of Companies.

PNB said proceeds of the planned stock rights offering would be used to strengthen its common equity Tier 1 (CET-1) and enable the bank to sustain its asset growth.

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

PNB 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.