BDO raises P36b from bond sale

BDO Unibank Inc., the country’s largest lender controlled by the Sy family, said Friday it raised P36 billion from the issuance of fixed-rate peso bonds amid the robust demand from individual and institutional investors.

BDO said in a disclosure to the stock exchange the proceeds were more than seven times the original offer of P5 billion. “The latest bond issuance is part of BDO’s continuing efforts to diversify its funding sources and support its lending activities,” it said.

“The bonds have a tenor of 1.75 years and a coupon rate of 3.125 percent per annum. Interest will be paid quarterly, calculated on a 30/360 count basis,” the bank said. The offering period started on June 15 and ended on June 26.

The bonds were exclusively offered through BDO Trust & Investments Group and BDO Private Bank Trust.

Standard Chartered Bank was the sole lead arranger and market maker for the issuance, while BDO Unibank and BDO Private Bank Inc. were the selling agents.

BDO president and chief executive Nestor Tan assured the bank’s continued strength amid the challenging environment highlighted by the spread of coronavirus disease.

The bank allocated P20 billion in additional provisions after a comprehensive review of the loan portfolio. Tan said the move was anticipatory in nature, adding this was a prudent measure amid the challenging environment.

The bank’s net income hit a record P44.2 billion in 2019, while its first-quarter net profit reached P8.8 billion on the back of strong core income sources.

Tan said the bank’s capital position remained strong despite the additional provisions, and that BDO intended to continue with its regular quarterly dividends.

The bank paid out P0.30 per share in cash dividend on common shares for first quarter 2020 and declared the same for the second quarter 2020 payable on June 29, 2020 to all stockholders of record as of June 17, 2020.

BDO is a full-service universal bank which provides a wide range of corporate and retail banking services.  These services include traditional loan and deposit products, treasury, trust banking, investment banking, private banking, rural banking, cash management, leasing and finance, remittance, insurance, retail cash cards and credit card services.

BDO has more than 1,400 operating branches and over 4,400 ATMs nationwide.  It also has full-service branches in Hong Kong and Singapore and 15 overseas remittance and representative offices in Asia, Europe, North America and the Middle East.

BDO is the country’s largest bank in terms of total assets, loans, deposits and trust funds under management based on published statements of condition as of March 31, 2020.