PSBank starts offer of P3-billion LTNCDs
PHILIPPINE SAVINGS Bank (PSBank) has started its offer of long-term negotiable certificates of deposit (LTNCD), which will be used to expand its consumer banking segment.
In a regulatory filing on Tuesday, the listed thrift banking arm of Ty- led Metropolitan Bank & Trust Co. ( Metrobank) said it is offering at least P3 billion in LTNCDs with an option to upsize.
The LTNCDs will be offered from July 24 to Aug. 2, while the issue date will be on Aug. 9.
The instruments will mature in five years and six months and carry an interest rate of 5% to be paid quarterly.
PSBank said in a previous disclosure that its board of directors approved the issuance of up to P15 billion worth of LTNCDs. The offerings will be conducted over a year in two or more tranches.
LTNCDs are similar to regular time deposits which offer higher interest rates but cannot be pre-terminated. Being “negotiable” means these can be sold at the secondary market prior to maturity date.
In a chance interview, PSBank President Jose Vicente L. Alde said the lender will offer longterm papers to expand its consumer banking segment brought about by its “robust” growth.
“[ Proceeds of the fund will go to the] expansion of the consumer business,” Mr. Alde told BusinessWorld in June. “We have been growing our consumer business for past years, and we still expect the consumer business to be robust in the next years, so we’re preparing for that expansion.”
Minimum investment for the LTNCDs is at P50,000 and in increments of P50,000 thereafter.
ING Bank, N.V. and Standard Chartered Bank will serve as joint lead arrangers and bookrunners of the issue, while First Metro Investment Corp., Metrobank and PSBank serve as selling agents.
Earlier this month, China Banking Corp. and Robinsons Bank Corp. likewise conducted LTNCD offerings, raising P10.25 billion and P1.78 billion, respectively, to support loan growth and stabilize cost of funding.
In the first quarter, PSBank’s net profit stood at P641.1 million, up 25% from the P511.1 million in the same period last year supported by its retail loan business.