Bank of Commerce ends maiden bond offer early

MANILA, Philippines — Institutional and retail investors gobbled up the peso bonds offered by Bank of Commerce, prompting the listed bank to end the offer period of its first foray into the domestic debt market a day after it started.

Due to overwhelming demand, the banking arm of diversified conglomerate San Miguel Corp. (SMC) shortened the offer period to July 12 instead of the original schedule of July 11 to 22.

The bank was eyeing at least P3 billion with an oversubscription option from the fund raising activity that is part of its P20-billion bond program.

The Series A bonds, with a tenor of two years and a fixed rate of 5.0263 percent per annum, will be listed on the Philippine Dealing and Exchange Corp. (PDEx) on July 29.

Proceeds of the fund raising activity would be used to manage the bank’s net interest margin by matching long-term assets with long-term funding to reduce interest rate risk, to diversify funding sources, and for general corporate purposes, the bank said.

ING Bank Manila Branch and Philippine Commercial Capital Inc. (PCCI) served as joint lead arrangers and joint bookrunners, while Bank of Commerce also acted as a selling agent.

Earnings of Bank of Commerce more than doubled to P360.6 million in the first quarter from P146.3 million in the same quarter last year on the back of strong core business activities despite the continuing local and international market volatilities.

For the first quarter, the bank’s provision for credit and impairment losses plunged by 98.7 percent to P771,500 from P59.86 million.

Its total assets inched up by 3.3 percent to P206.4 billion in end- March this year from P199.71 billion in end-2021 mainly due to the 13.8 percent growth in loans and receivables.

Bank of Commerce booked a double-digit growth in total equity to P26.7 billion in the first quarter from the P23.4 billion in previous quarter, spurred mainly by proceeds from its initial public offering (IPO) last March.