RCBC raises P3.58b from new LTNCDs due in 2024

Rizal Commercial Banking Corp., the 10th-largest lender in terms of assets, successfully returned to the debt capital markets after raising P3.58 billion of new long-term negotiable certificates of deposits due in 2024.

The 5.5-year LTNCD carries a coupon of 5.50 percent yearly. The latest issuance of LTNCDs by the bank followed a P2.502-billion issue of the same instrument in August 2017 and $450 million in senior Reg-S bonds issued in the offshore market earlier this year.

Bank president and chief executive Gil Buenaventura said the notes issuance was part of RCBC’s initiatives to maximize long-term funding.

“We thank our clients and investors who continue to believe in our credit story and have supported us in our various fundraising exercises so far. This latest LTNCD issuance provides us a competitive long-term funding base for the bank that will be used to support our growth objectives,” Buenaventura said.

“We will keep our eyes out for similar such opportunities to lock in attractive cost of funding or explore alternative avenues that will support our strategic plans,” he said.

Hongkong and Shanghai Banking Corp. acted as sole lead manager and bookrunner for the deal and was also a selling agent, along with RCBC, RCBC Savings Bank and Multinational Investment Bancorporation.

LTNCDs are bank products with long tenors which are offered to investors looking for a higher interest rate compared with regular savings accounts or shorter-term deposits.

RCBC remains one of the leading universal and commercial banks in the country. 

Net income in the first half, however, fell 6 percent to P2.2 billion from P2.35 billion a year ago on lower trading gains. But excluding non-recurring income (trading gains), core income grew 47 percent from a year ago, reflecting the robust growth in earnings from core businesses.

Net interest income rose 12 percent to P9.7 billion year-on-year. Even with the intense pricing competition, the bank still achieved an annualized net interest margin of 3.98 percent, which remains one of the highest in the sector.

The bank’s lending business is vibrant with net loans and receivables expanding by 14 percent to P372 billion. All market segments sustained their solid growth with 11-percent growth in corporate loans, 36-percent increase in SME Loans, 17-percent rise in consumer loans and 33-percent expansion in credit card receivables.

Buenaventura said the bank’s trajectory was on an uptrend and above target in the first half of 2018.

Topics: Rizal Commercial Banking Corp , Gil Buenaventura , Hongkong and Shanghai Banking Corp , Multinational Investment Bancorporation
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