BDO raises record P40 billion from bonds

MANILA, Philippines — BDO Unibank Inc. returned to the domestic debt market, raising a record P40.1 billion through the issuance of fixed rate bonds as part of the bank’s continuing efforts to diversify its funding sources and support its lending activities.

Retail and institutional investors gobbled up the 2.5-year bonds carrying a yield of 4.408 percent per annum as the amount raised was eight times the original offering of P5 billion.

BDO president and chief executive officer Nestor Tan said the bank continues to periodically issue fixed rate peso bonds as well as long-term negotiable certificates of deposits (LTNCDs) to diversify and lengthen its funding sources and support business expansion plans.

“Any future issuance will be determined by the bank’s funding needs and market rates,” Tan said.

In the latest fund raising activity, HSBC acted as the sole lead arranger, while BDO Unibank, BDO Private Bank and HSBC served as selling agents.

The country’s largest lender launched a P100-billion bond program in August 2018.

Of the total, BDO raised P35 billion via the issuance of fixed rate bonds in February last year.

Data from Philippine Dealing and Exchange Corp. (PDEx) showed debt issuance by Philippine banks jumped by 132.5 percent to P268.98 billion in 2019 from P115.7 billion in 2018. The financial sector accounted for 71.8 percent of the total record high P374.53 billion new listings at the PDEx last year.

BDO topped the list after raising P48.82 billion through the issuance of bonds and LTNCDs, followed by Metropolitan Bank & Trust Co. (Metrobank) with P42.5 billion and Rizal Commercial Banking Corp. (RCBC).

Another, Sy-led bank, China Bank, issued fixed rate bonds worth P30 billion, while Philippine National Bank (PNB) of tobacco and airline magnate Lucio Tan raised P26.69 billion consisting of P20.17 billion worth of bonds and P12.82 billion worth of LTNCDs.

BDO has one of the largest distribution networks, with more than 1,400 operating branches and over 4,400 ATMs nationwide.

It also has full-service branches in Hong Kong and Singapore as well as 20 overseas remittance and representative offices in Asia, Europe, North America and the Middle East.