BDO to issue up to P2.9B of time deposit certificates

Banco De Oro Universal Bank has received the green light from the Bangko Sentral ng Pilipinas (BSP) to issue up to P2.9 billion worth of long-term negotiable certificates of time deposit (LTNCD).

An LTNCTD is a certificate of deposit issued by banks with a maturity of at least five years. Unlike regular time deposits, an LTNCTD may be negotiated over its life. Banks issue LTNCTDs to lengthen the maturity profile of their deposits and match their long-term assets.

In a disclosure to the Philippine Stock Exchange, BDO said it has tapped Standard Chartered Bank as lead underwriter for the issue. The other selling agents are BDO Capital & Investment Corp., BDO Securities Corp., and BDO Private Bank.

The LTNCTDs will have a maturity of five years and one day, with the fixed rate to be determined prior to the offer period later this month.

This will be the second tranche of LTNCTD offered by BDO this year.

BDO ranked among the top eight banks in the Philippines in terms of total deposits, net loans and capital assets as of June 2005.

BDO provides a wide range of corporate, commercial and retail banking services. These services include traditional loan and deposit products as well as treasury, trust banking, investment banking, cash management, insurance, retail cash cards and credit card services.

The bank’s consolidated assets stood at P212.3 billion as of end-September this year. Total capital funds, on the other hand, amounted to P18.8 billion as of Sept. 30, 2005.

BDO is eyeing as much as 25- percent increase in its net earnings this year to P2.5 billion from the P2-billion profit it posted last year as it beefs up its core businesses and realizes gains from recent acquisitions.

In the nine months ending September this year, BDO posted a net income of P1.84 billion, up 35 percent from the previous level’s P1.36 billion. Net interest income, on the other hand, rose 39 percent to P4.87 billion from P3.5 billion, due to a 34-percent expansion in the bank’s balance sheet and higher margins.

BDO recently bagged a deal that, once completed, will make it the second-largest shareholder in Equitable PCI Bank, opening the door to a merger that could create the country’s largest bank.

BDO and Equitable PCI’s founding Go family had reached an agreement for the sale to the SM Group of up to 180 million shares in Equitable PCI.

The SM Group is controlled by retail tycoon Henry Sy, whose other interests include property development, shopping mall operations and retailing.