Security Bank shortens offering for peso bonds

Security Bank Corp. has shorted the offer period for its two-year fixed-rate peso bonds as orders already exceeded the original volume of P3 billion due to strong demand from investors.

Raul Martin Pedro, treasurer at Security Bank, said the offer period for the fund raising activity that started on June 23 has been cut to July 3 instead of July 15.

Pedro said the bank has yet to determine the amount raised but it was over the originally announced P3 billion offering.

“We appreciate the overwhelming support that our investors and clients have been giving our bond offer. In view of the strong demand we have received so far, we are shortening the offer period to end on July 03,” Pedro said.

Proceeds of the bond offering will be used to extend the tenor of the bank’s liabilities and augment its lending business. The bonds with a yield of 3.125 percent per annum would be issued out of Security Bank’s P100-billion peso bond and commercial paper program, double the P50-billion program established in December 2018.

Of the total amount, the bank has so far raised P18 billion in its maiden bond issuance in June last year.

Security Bank last tapped the domestic debt market in February, raising P2.07 billion through the issuance of longterm negotiable certificate of deposits (LTNCDs) due 2025, bringing to P24.82 billion the amount raised from LTNCDs since November 2017.

Last April, the bank has also established another P50-billion LTNCD program.

Security Bank continues to tap both the onshore and offshore debt markets to finance its expansion program and augment its loan portfolio.

The bank last tapped the offshore debt market in September 2018, raising $300 million via the issuance of five-year senior unsecured fixed-rate notes to expanding its funding base and extend term liabilities under its $1 billion medium term note program.

Earnings of Security Bank went up by 21 percent to P2.9 billion in the first quarter of the year from P2.38 billion in the same period last year as provisions for loan losses amounted to P5.7 billion and exceeded the P4.2 billion made for the entire 2019 in anticipation of higher defaults due to the coronavirus disease 2019 or COVID-19 pandemic.