EastWest eyes P15-B LTNCDs

Gotianun-led East West Banking Corp. is returning to the debt market this year to raise as much as P15 billion in fresh funds as part of its liability management program.

EastWest informed the Philippine Stock Exchange (PSE) the bank’s board of directors approved yesterday the issuance of long-term negotiable certificates of time deposits (LTNCDs).

The country’s largest bank in terms of assets said the fund raising activity is aimed at diversifying the bank’s funding sources as part of its overall liability management.

It added terms of the LTNCD issuance would be disclosed once the corresponding regulatory approvals from the Bangko Sentral and Pilipinas (BSP) are secured.

LTNCDs are negotiable certificates of deposit with a designated maturity, and represent a bank’s obligation to pay the face value upon maturity, with periodic coupon or interest payments during the life of the deposit. Interest income is exempt from withholding taxes if the LTNCDs are held for at least five years.

Last September, EastWest completed the issuance of P10 billion worth of LTNCDs with the listing of the fifth and final tranche on the Philippine Dealing and Exchange Corp. (PDEx) amounting to P2.63 billion.

EastWest raised P1.07 billion from the issuance of LTNCDs in July last year, P2.59 billion in May, and P995.2 million in April.

The bank founded by the late taipan Andrew Gotianun earlier announced the increase in its authorized capital to P50 billion from P20 billion as part of efforts to sustain its momentum as the fastest growing bank in the Philippines.

This would pave the way for the issuance of an additional three billion common shares wit a par value of P10 per share.

EastWest also declared a 50 percent stock dividend or 750 million common shares, representing the minimum 25 percent subscribed and fully paid-up subscription.