RCBC sees investment opportunities

LISTED Rizal Commercial Banking Corp. (RCBC) said on Tuesday it was seeing possible investment opportunities in both the domestic and international markets for the rest of the year.

In a statement on Tuesday, the Yuchengco-led lender quoted Horacio Cebrero 3rd, RCBC senior executive vice president and treasurer, as saying the bank expected to see these opportunities in the fixed-income space.

The expected inflation trajectory influencing the movement of domestic rates in the long end of the interest rate yield curve, coupled with supply driven issues, continue to be monitored.

“There may be an increase in appetite for fixed-income securities in the domestic markets, as there will be opportunities opening up [in the] second half of the year,” Cebrero said.

While inflation would remain benign until the end of the year, inflation expectations for incoming periods are considered a catalyst in terms of the direction of interest rates, he added.

Also, an increase in foreign investments could be undertaken this year, compared to the first quarter of 2020, if a window of opportunity presents itself.

RCBC is also looking for good bets in the Philippine and US equities market to diversify its investment portfolio.

On the other side of the balance sheet, in terms of its funding exercise, the bank would continue to tap the domestic investor market by issuing medium-term bonds in line with its liability management strategy.

It would also continue to monitor developments in the international markets to assess the right time to tap the US dollar- denominated bond market.

“The planned US- dollar senior note [issuance] that we were looking at for this year has been pushed back primarily due to the high liquidity level that the bank currently maintains, and partly due to the developments in the interest and credit markets as a consequence of the ongoing pandemic,” Cebrero said, referring to the coronavirus crisis.

“However, if an opportunity presents itself, we will not hesitate to go back to the international bond market for prefunding our requirements in the coming year,” he added.

Last month, RCBC generated P16.6 billion in fresh funds from its latest bond offering, more than five times its original minimum issue size of P3 billion.

RCBC shares rose by 12 centavos or 0.77 percent to close at P15.72 each on Tuesday.