BPI upsizes TD offer to P12.2 billion

The Bank of the Philippine Islands (BPI) issued last week P12.2 billion in long-term negotiable certificates of time deposit (LTNCTDs).

Strong demand, it said, prompted the bank to upsize from its initial offering of P5 billion to Php12.2 billion, making the transaction the largest single LTNCTD issuance thus far.

The LTNCTDs were also listed at the Philippine Dealing Exchange Corp. (PDEx), the first instrument listed by BPI in the fixed income exchange. The listing allows investors to negotiate the instrument in the secondary market.

“This reflects the confidence of investors in BPI,” said Cezar P. Consing, in a statement released to the Philippine Stock Exchange. “The success of this offer will help us in our expansion plans as we continue to focus on shareholder value by pursuing sustainable growth and profitability.”

This issuance is the first tranche of the P30-billion LTNCTD issuance program approved by the Bangko Sentral ng Pilipinas (BSP) for BPI. In addition to supporting the bank’s expansion plans, the issuance will diversify the bank’s funding sources while offering investors an attractive investment instrument.

The LTNCTDs have a tenor of five and a half years, maturing on May 24, 2023, and an interest rate of 3.75 percent per annum payable quarterly.

LTNCTDs are peso-denominated certificates of time deposit with a minimum maturity of five years and are negotiable in the secondary market. Historically, LTNCTDs offer higher interest rates than regular deposits. LTNCTDs are also insured with the PDIC subject to applicable rules and regulations on maximum insurance coverage.

ING Bank N.V., Manila Branch was tapped as the sole arranger for this issue and also acted as selling agent together with BPI Capital Corporation and BPI.