MANILA, Philippines — Bank of Commerce has raised P7.5 billion, more than double the original size of P3 billion, in its first foray into the domestic debt market, as institutional and retail investors swarmed its peso bond offering.
The Series A bonds issued by the banking arm of diversified conglomerate San Miguel Corp. (SMC) will be listed on the Philippine Dealing and Exchange Corp. (PDEx) today.
Due to overwhelming demand, the listed bank ended the offering of the fixed-rate bonds with a tenor of two years and a fixed rate of 5.0263 percent per annum a day after it started. The original offer period was from July 11 to 22.
The fund raising activity is part of the bank’s P20-billion bond program.
According to Bank of Commerce, the 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.
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.
The banking arm of SMC raised P3.36 billion via an initial public offering (IPO) last March to finance the bank’s lending activities and finance its capital expenditure requirements.
The earnings of Bank of Commerce more than doubled to P360.6 million in the first quarter of the year from P146.3 million recorded 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 of the year, 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 IPO last March.
Bank of Commerce has a network of 140 branches and aims to deploy more ATMs in addition to the 253 count at end March.