Bank of Commerce eyes P10 billion LTNCDs
Lawrence Agcaoili (The Philippine Star) - December 21, 2019 - 12:00am

MANILA, Philippines — Bank of Commerce, the banking arm of diversified conglomerate San Miguel Corp. (SMC), is tapping the onshore debt market early next year to raise P10 billion to diversify its funding sources.

The Bangko Sentral ng Pilipinas (BSP) has given the bank the green light to issue long-term negotiable certificates of time deposits (LTNCDs) in 2020 to also support its expansion plans in one or more tranches.

The first tranche is set in the first quarter of next year as approved by the central bank.

Bank of Commerce has tapped Standard Chartered Bank and Philippine Commercial Capital Inc. (PCCI) as joint lead arrangers while Standard Chartered Bank and Bank of Commerce would act as selling agents.

LTNCDs are bank deposit products denominated in peso with a minimum maturity of five years. Individual investors who hold on to LTNCDs for at least five years will enjoy tax-free interest earnings. Similar to a time deposit, LTNCDs offer higher interest rates.

LTNCDs are insured by PDIC up to maximum coverage per depositor of P500,000 in aggregate with any existing deposits with the bank.

However, unlike a time deposit, LTNCDs cannot be pre-terminated, but can be sold to the secondary market should an investor wishes to liquidate the investment.

Bank of Commerce is the country’s 17th largest bank in terms of assets with P139.74 billion as of end-June. In terms of capital, it is also ranked 17th with P15.81 billion.

The bank’s total loans and receivables stood at P76.14 billion as of end-June, while its deposit base reached P118.9 billion.

Bank of Commerce is one of the country’s progressive commercial banks. It has been in operation since 1963. In 2008, it was strengthened further with the investment of the San Miguel Group.

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