BSP signs $500-M club loan

The Bangko Sentral ng Pilipinas (BSP) yesterday signed its $500 million term loan facility intended as a stand-by facility to beef up its international reserves and refinance a $200-million note due this month.

The term loan was arranged by seven arrangers with allocations to a diverse syndicate of 18 other foreign and domestic financial institutions and the BSP expressed optimism that the success of the loan demonstrated confidence on the country’s economic prospects.

The arrangers were composed of Citibank NA, Credit Lyonnais, HSH Nordbank AG, Mizuho Corporate Asia Ltd, Standard Chartered Bank, Sumitomo Mitsui Banking Corp and DBS Bank Ltd.

"The diverse supporting bank group to this facility demonstrate the banking community’s continued confidence in the direction and development of the Republic of the Philippines as well as the critical role played by the BSP in the country in the face of ongoing geopolitical conditions," the arrangers said in a statement.

The loan is a three-year facility payable in bullet repayment at final maturity with a margin of 2.6 percent per anum over 3 to 6 months over US dollar LIBOR.

The loan also includes an option to allow lenders to convert their participation in the facility into floating rate notes one time on the first interest payment date after drawdown.

Specifically, BSP deputy governor Amando Tetangco, Jr. said the proceeds of the loan would be used to refinance BSP’s $200-million floating rate note facility due on October 27 this year. The remaining portion would be used for the BSP’s general funding requirements, specifically its international reserves.

The biggest allocation of the loan went to the Metropolitan Bank & Trust Co, which is also a co-arranger. The bank got an allocation of $50 million.

On the other hand, final allocations of $40 million went to six of the seven arrangers except DBS which got a $36.5 million allocation.

The issue managers, on the other hand, would get allocations of $10 to $15 million each. These managers were composed of Raiffeisen Zentralbank Oesterreich (RZB-Austria) Singapore Branch, Equitable PCI Bank, Mashreqbank psc, Philippine National Bank, Taiwan Cooperative Bank, and the United World Chinese Commercial Bank.

Listed as co-managers were the Bank of Taiwan Hongkong Branch, Ahli United Bank BSC, the Arab Investment Co SAA, Banco de Oro Universal Bank, International Exchange Bank, East West Bank, Baden-W?rttembergische Bank AG and the Development Bank of the Philippines.

The co-managers received allocations ranging from $2.5 million to $8 million each.