Bank of the Philippine Islands, the third-largest lender in terms of assets, will issue half of its P50-billion bond and commercial paper program due to the expected strong demand from investors.
The bank said in a disclosure to the stock exchange Friday its board in a meeting on Oct. 17, 2018 approved an initial peso bond issuance of up to P15 billion.
The board later on increased the amount because of the strong demand from investors.
“Noting strong investor demand from the book-building, the board of directors increased the approved maximum size of the initial issuance to P25 billion on Nov. 15, 2018,” the bank said.
BPI on Sept. 19 said it was putting up a peso bond and commercial paper program to raise P50 billion for general corporate purposes.
The bond program follows BPI’s successful $600-million debut issuance of five-year senior unsecured fixed rate notes in August under a $2-billion medium-term note program.
The notes fetched a coupon of 4.25 percent. The issuance marked the first in the bank’s 167-year history and the largest-ever debut issuance for a bank in the Philippines.
The issuance was part of the bank’s initiatives to maximize flexibility in accessing offshore funding. The offering came after the successful fixed-income investor calls and roadshow meetings in Hong Kong and Singapore on Aug. 24 and 27, 2018.
BPI president Cezar Consing said the capital-raising initiative allowed the bank to diversify its sources of liquidity, lengthen the maturity profile of borrowings and manage the growth of its balance sheet more efficiently.
On Thursday, global debt watcher Moody’s Investors Service affirmed the investment grade or “Baa2” local and foreign currency deposit and foreign currency senior unsecured debt ratings of BPI.
Moody’s cited the bank’s consistently robust capital and liquidity, which reflect disciplined and prudent business growth. The ratings outlook is stable.
BPI posted a 12-percent increase in net profit in the third quarter to P5.98 billion from P5.36 billion a year ago, driven mainly by the 21-percent expansion in net interest income.