RCBC eyes P3 billion from issuance of ASEAN sustainability bonds

MANILA, Philippines — Rizal Commercial Banking Corp. is eyeing to raise at least P3 billion from the issuance of ASEAN sustainability peso bonds.  

The bank started offering 2.5-year bonds with a fixed interest rate of 3.2 percent per annum and 5.25-year bonds at 4.18 percent on March 12. The offer period will   end on March 19 unless shortened or extended in consultation with Standard Chartered Bank as sole lead arranger and RCBC Capital Corp. as financial advisor.  

RCBC said the proceeds of the fundraising activity with an option to upsize would be used to support asset growth, refinance maturing liabilities as well as other general funding purposes.  

RCBC said the fundraising activity is also aimed at financing eligible loans defined under the bank’s Sustainable Finance Framework that has been certified by leading independent environmental, social, and governance (ESG) research and rating provider Sustainalytics.  

This is the third time RCBC is issuing green or sustainability bonds as part of its P100-billion bond and commercial paper program.  

It has raised more than half of the total amount including P15 billion via the issuance of ASEAN green bonds in February 2019, P8 billion via ASEAN sustainability bonds in June 2019, P7.5 billion in November 2019, P7.05 billion in March  and P16.6 billion in July last year.  

Listing on the Philippine Dealing and Exchange Corp. (PDEx) is scheduled on March 31.  

The bank’s provision for impairment losses reached P9.33 billion last year, P1.93 billion higher than the P7.4 billion allocated in 2019 to manage the higher risks due to the economic slowdown brought about by the pandemic.  

For 2021, the Yuchengco-led bank intends to maintain high provisioning but not as high as that of last year, bringing it down to about 1.5 percent of total loans compared to last year’s two percent.  

   RCBC’s asset base remained steady at P770.77 billion, while its capital jumped 22.5 percent to P101.46 billion resulting to a capital adequacy ratio of 16.1 percent and common equity tier 1 ratio of 12.6 percent. Return on equity stood at 5.6 percent and return on asset at 0.7 percent.