PNB raises P4-B in LTNCD offer
MANILA, Philippines - Philippine National Bank, the fourth largest privately owned bank in the country, has raised P4 billion in its second Long Term Negotiable Certificates of Time Deposits (LTNCD) this year.
"We did not expect such an overwhelming demand for our LTNCDs during our first issuance, which carried the lowest ever coupon rate of its kind. This prompted us to issue a second tranche of LTNCDs which has proven equally successful. The robust appetite for PNB’s issuances shows our growing competitiveness in the local market," PNB’s president and CEO Omar Mier said.
PNB was able to raise P4 billion from the second issuance of LTNCDs. The LTNCDs carry a maturity of five and a half years and have a coupon of 3.25% per annum. The public offer period ran from October 9 to 16. The issue date will be on October 21.
PNB had conducted another offering after its first issuance in July was oversubscribed. Proceeds from the second offering will be used for general corporate purposes and to further strengthen banking operations.
LTNCDs are negotiable certificates of time deposit with a designated maturity or tenor representing a bank’s obligation to pay the face value upon maturity as well as make periodic coupon or interest payments during the life of the deposit.
LTNCDs are insured by the Philippine Deposit and Insurance Corporation (PDIC) for up to P500,000 and are tax exempt for qualified individuals if held for at least five years.
The Hongkong and Shanghai Banking Corporation Limited (HSBC) acted as the sole lead arranger and selling agent of the issuance. In addition to HSBC and PNB, First Metro Investment Corporation (FMIC) and Multinational Investment Bancorporation (MIB) also acted as selling agents while Deutsche Bank AG, Manila Branch acted as registry and paying agent.
"It is not often that we see a bank such as PNB offer two LTNCD tranches in one year. The fact that both issuances were executed successfully is a testament to the growth of PNB and the support given to them by customers and investors," HSBC Philippines president and CEO Wick Veloso said.